[decker]

Originally on my G5 I mounted the toolbag on the passenger grip, this however let it rub paint from the tail light housing. In pictures posted with toolbars on the front it appears to be hung over the RE logo plate between the front forks. This seems sharp and liable to cut anything hanging the bag. How are people attaching their tool bags and where. I don't want to continue marring the paint.

[ace.cafe]

You are better off with it at the back of the bike. Or just use the triangular tool box on the side of the bike.
It is NOT good to mount under the headlight, because it can block the cooling air to the engine, and it may get squeezed by the front fender at full compression of the front suspension.

I think the bottom line is that you had it in the best place. You might try to figure out a way to reduce the rubbing, or revert back to the original tool box.