To be clear: When you are fishing live bait or chunk, you will use the rear drag. The rear drag should be set to a tension that allows the fish to "run" with the bait a bit, without feeling unnatural resistence, before you're ready to set the hook. For chunk, you might set the rear drag a bit lighter than you might for live bait since chunks don't swim
When you're fighting the fish, you'll be using the front drag, so set the drag for the tension you desire for that purpose (setting the hook and fighting the fish). When you're ready to set the hook, flip the lever to the front drag, then rear back and set the hook.
This basically serves the same purpose as fishing with an open bail where you might tend the line between thumb and forefinger allowing the bait to swim or the fish to take the bait without too much resistence. In other words, the rear drag tends the line for you, while allowing you to keep the bail closed the whole time.
Make sense?