Indexed or not?

If you have a non-indexed shifter (i.e. old stuff, bar-end or downtube shifter), then it doesn't matter because the limit screws will limit the derailleur movement. Considering that the shifter is able to shift through 4 rings (verified) or maybe 5, you would need a lot of slack in the cable before it would actually prevent you from shifting all the way to the large cog.

If you have an indexed shifter (i.e. STI, Rapidfire... and a lot of new stuff), then I think you should keep a weeny tiny little amount of slack in the cable, and then take all the slack away with the adjusting screw. How much? Enough that the cable isn't loose anymore, but not enough that you start moving the derailleur. How to check? Basically check with the middle gear. If you take too much or too little slack, the derailleur won't be properly aligned when you shift in the middle ring.