#1 is your bubble counter. The line from your CO2 tank connects there. #2 looks like where you would supply water from your tank via a powerhead. #3 although I can't see it but it should be where you return water to the tank.
You should have a valve to control the water flow through the reactor. I would set it to a fast drip. The bubble count depends on what's in the tank. I would start it low, 20-40 BPM, wait a few days, test the water and adjust from there.