How do you run both? Or is this one as a VM within the other?

QubesOS comes with Whonix VM templates configured by default.

Typical configuration would be one Whonix-Gateway to connect to Internet via Tor and one or more Whonix Worstations.

https://www.whonix.org/wiki/Qubes

Install Qubes and it will give you an easy option to install Whonix. Out of the box Qubes supports Debian, Fedora, and Whonix very well. If the Qubes installer works on your hardware, the setup is a breeze. Qubes does have a bit of a learning curve, but largely non-technical (separating activities out into different VMs, and installing software onto a template instead of directly in the VM)

Is it me or the install process to USB is absurdly complex?

Use Qubes OS (which includes Whonix), it's very straightforward to install.