> Does it ever put things in absurd places, eg. a necessary dungeon key in a random grotto halfway across the map (or in another time)? Without clues, how would you know where to check next? Does the game help at all?

I haven't played this OOT randomizer, but with the Wind Waker randomizer I've been playing, you can configure things like that - so dungeon keys could spawn in their own dungeon only, or literally anywhere in the world, or just other dungeons. It also has settings that allow you to talk to an NPC to get hints where game-progressing items are.