As far as i've found, real Clark Michigan cranes seem to be set up with a pair of dead lines off the tip to a sheeve block, cables run from the sheeves back to the house some unknown number of times for mechanical advantage and to reduce the amount of cable.
these are the most helpful images I've been able to find so far
Stock toy just had it route: fixed at house, tip pulley, cable drum. And it works fine as a toy.
Atleast for now, i'm thinking split the difference like jim did: fixed at house, tip, house, tip, house, drum.