Hello Brauske,
Neither - nor.
Both your ways you would like to install the seal are incorrect and will result in a lot of rain (and car wash ~) water in your trunk - and rattleing noises.
The seal should be installed that way that it comes up from the inner edge of the trunk seal groove and then bending outwards- all around.
This is the associated pic.
I find it a bit tricky to glue in the seal.
My advice (after doing this twice):
1. put it in without glue first so that the orientation is correct all around.
2. Cover the fender's etc. paint with masking tape adjacent to the seal.
3. Glue in the seal part by part, e.g. every 50 cms or so.
Good luck !
Achim
(who still needs to put in the new TS in the W114)