I would say off to the side.  You start with the ball in front of you, then you need to move the ball off to the side in order to clear your hips.
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It IS next year!

When you are a high level bowler, PBA, collegiate, etc., where you are bowling 100 games a week, you can afford to have a lot of "moving parts" as I like to call them in your game.  However, for most of us who only bowl maybe a couple times a week (say 20 games max, and I think that's being very generous), in my opinion, simpler is better.  

Addressing your specific question, if you start your arm swing straight, you are more likely to finish is straight.  You are also more likely to have your arm swing be the same every time.  Let's say with your starting position in front, in order to get it in line, you need to push 4 inches to the side.  Well, sometimes you're only gonna push 2, other times 6, 8, etc...I hope you see where I'm going.  

Shot repetition = High scores
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It IS next year!

Whether you hold the ball "free" or use your elbow to support the weight does IMO not matter, as long as you actually hold the ball in front of your shoulder and allow a free pendulum, without need to swing it around you. Just do not hold the ball in front of you, that's a potential trouble source. Keep its simple!
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DizzyFugu - Reporting from Germany

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my suggestion would be to go to YouTube, type in the names of some of the pros and try to do what they do. I did that and started putting the first step of my ball side foot in front of the slide foot. This opens a nice slot for the ball to drop straight down instead of having to swing around the hips.
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Moon
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So many questions, so little time but I'm having fun.