Common advice is to increase the MTU from 1500 to 1504 bytes. But I'm not sure if on ROS it's the L2MTU you'd be looking at instead. I'm gonna do some fragmentation tests tomorrow and see what I can find.
The service tag is usually used on the outside and sets the packets' TPID to 0x88a8, signalling that this vlan is a s-vlan (think of "s" as in "service provider") containing c-vlans (c = customer) according to 802.1ad. The normal vlan TPID (802.1q) is 0x8100 and remains the same for c-vlans.
Wether you need to set the service tag depends on your setup. If you use q-in-q with devices from other manufacturers chances are they can only deal correctly with your s-vlan if the TPID is correctly set to 0x88a8. But on a lot of devices the inner and outer TPIDs can be configured.
We use it this way because
a) there's no reason for us not to comply to the standard and
b) our carrier expects correctly marked 802.1ad packets, strips the s-vlan tag and delivers the c-vlan packets to our customers.
802.1ad was developed out of 802.1QinQ, often confused with 802.1q. In 802.1QinQ 0x8100 was used. This was changed in 802.1ad. So maybe being able to still use 0x8100 as outer TPID may have to do with backwards compatibility. See http://en.wikipedia.org/wiki/IEEE_802.1ad