It depends on the look you want. Stippling around the applique makes the applique/embroidery stand out more since the stippling makes the surrounding fabric flatter. If you want to lessen the emphasis on the applique/embroidery, do your stippling over it. The applique will still be seen, but will not stand out as much. If you're doing something with many appliques or embroideries, you can get a feeling of depth to the picture by letting some stand out and "move" to the front and stippling over others to "move" them to the back.