Euan was 3 months when I first used an Ergo (without infant insert). He was also very long, and didn't have any problems with hip extension at that age. It would depend on the baby though.

I don't believe that it's recommended to use an Ergo in the cradle position without the insert (I think that it does help to balance the weight evenly, which could be one reason why you are getting such shoulder strain Plonkeemumma, the other could be that she is too heavy or big to cradle carry with a balanced centre of gravity), and once they get to about 3-4 months they should be in a vertical front carry.

Mel, when you say that she seems too high, where on you does the waist support sit? On an Ergo it should sit on the hips (most mei tais tie at the waist, whereas most SSCs sit at the hips). This allows bubs bum to sit at bellybutton height. However, the Ergo is quite a short bodied carrier, so you may find that the top of the body only comes up to her armpits if she is long. If her head is going under the shoulder straps, you may need to tighten them, having them loose enough to fit a baby's head under might give you sore shoulders, as her body might lean back a bit and cause drag. The optimum position is for her body to be as tight to yours as comfortable.

The ideal height for baby's head is at kissing height - you should be able to tilt your head down and kiss the top of their head. But it does depend on the length of the baby. Their bum should be at bellybutton height or higher. Lower than this and the centre of gravity may be unbalanced. Although if front carrying a toddler their head may end up higher because their body is longer.

A good way to get a nice tight fit on any carrier, is to settle bubs into it, grab the straps and bounce up and down, pulling the straps tight as you go. If bubs is a leaner, you can lean back a little so that their body flattens against yours. This settles bubs nicely into the seat.