Mahesh, the general idea is that the speakers should be separated by the same distance(or just a bit less)as your listening location is from them. In your situation I'd think that the 8-9 foot separation while listening 10 feet away should work well.
There have been about three reports, as I recall, of vertical M2s giving good results as center speakers. Search topics such as M2(and)center. Yes, as in any speaker calibration, the M2 would be adjusted so as to equalize the levels. It's generally suggested that at least 3" be allowed behind a rear-ported speaker.
