Steve, Put the form on the inside of the wall as the insulation. If you put the foam on the outside it will let the wall move ovet the years. Base coat of stucco is 3/8" which has to be screeded so the finoish coat will stick. Finish coat should be 1/8 to 1/4 ". Be sure to nail the wire mesh on the wall first if you are building a wood wall.