I rebuilt my old Peugeot into a commuter with fenders and rear rack, and I just tried out my panniers on it. Because of the way the panniers sit on the rack, the only place I can put a taillight that will be visible is on the seat post, and there's not enough seat post sticking out for a saddle bag and still leave enough room for any lights. And if the lights get too low, they'll be blocked from view by the panniers on the rear rack.

So the lights must get the seatpost.

There is a nice open area above the rear brake, in front of the rack and panniers, on top of and behind the seat stays, that's perfect for a tool bag. The open space is pretty much right under where a saddle bag would hang, and there's enough room there for a really BIG tool bag.

But I can't find any bag that could be go in there and attach to the seat stays. That's what I'd prefer.

Yes, I know I could get a frame bag that hangs on the top tube, but I'd prefer to put it out of the way and behind the seat tube somewhere.