Smysha - It is a little dusty yes, and leaves a little bit of dust on the bottom of the cage when you empty it out, but it shouldn't be overly dusty.
Demelza - you can use it for either. Most use it for the entire base of the cage as a substrate, but you could pop some in their house as well as the usual nesting material. I have started doing this as it has very good odour controll and my little madam likes to pee in her house - erlack!
