I use a 10 gallon or 20 and do full water from the start, 8 gallons in my case because I lose a lot from evaporation. I grind my extract finer than all grain, and the way I do it is to clamp the bag to the side while heating up from room temp to 154, let that set at 154 for 15 to 20 minutes depending how long it takes, then raise to 168 for 10 minutes, dunk and drain your bag then pull it out and add the sugar/ Malt, before the boil. watch your boil over on this one the foam will be huge because of the high gravity.