Rookie 4k question from experienced FCPX user

Despite owning FCPX since week one... I have never worked with 4k footage. I only edit my own stuff from C100mkII but now have c70 with 4K 160 Mbps Long GOP files but output will still be 1080p. What I have not been able to wrap my head around is how to get the most out of my new larger resolution. In past I could barely crop in for fear of soft, noisy images but now I can. HOWEVER -  do I create a 4k timeline and lay down 4k files, crop as needed, then allow rendering to handle it?  OR do I make same old 1080 timeline and as I lay down 4k clips they can be cropped without resolution loss.? OR is that all wrong?  I know this is a rookie question but the concept is lost on me. Thanks so much for any help in understanding this. (by the way I did a google search but not sure I am getting correct info)

Use a 1080 timeline. The 4k footage will be scaled down to fit but all of the original resolution is available so you can scale to 200% without losing quality.

Yes use a 1080 timeline. FCP automatically adjusts the footage to 'fit'. If you want to crop in, the best results I have found is to change the 'Spatial Conform' in the inspector from 'Fit' to 'None'. This will automatically scale your footage in to 1:1 pixel aspect ratio. The scale in the inspector will say 100% but your image will be scaled up to its max resolution. In other words, if you scale up any further, it will be like a digital zoom, and you are at risk of getting soft/ blurry images. Then you can scale down to your desired frame size. At this point, 50% scale would be equivelant to what you were viewing you footage at previously.

You can simply scale in without using the spatial conform, but if you start messing around with compound clips etc, and then scaling in a compound clip, my experience is that fcp renders the compound clip at 1080 and ignores the 4k footage inside it, so it thinks it is scaling up 1080 footage and becomes soft.

VERY good point about Compound, bjrE. Also, I simply find making all my 4K "None" makes it easier to resize while knowing what's going on with the clip's resolution.

Not to mention, I keyword all my 4K clips first.  That way I can select them all at one time, in a mixed frame size timeline via the Timeline Index, and set them all to "None" at one time.

Exactly. It makes it easier to keep on track of what you're doing, and keeps it simple when scaling up... ie: Don't go past 100.

I go past 100 all the time with good results.

Me too. I guess what I meant was, it keeps it simple ie: when you go past 100% you know you are scaling beyond the captured resolution... do so with educated caution

Most all footage I've ever worked with can go 130-140 percent and still look good. My GH5 I can push to 200 sometimes if it's in focus. The issue is, when shooting 4K, focus is VITAL but hard to really judge without a really good external monitor.  If focus is even just the very slightest bit off, 4K is very unforgiving.  This is why I'm in no hurry to move to 8K or higher.