For LAQ, my go to marking tool are the blue water soluble markers or the purple air erase ones. These work best when I have made a template for myself or I am transferring a design using my overhead projector. Test first, of course. These are great for light colored fabrics. For dark I like to use the ceramic mechanical pencil, like the Fons and Porter one, but the mark rubs off easily. I have marked a quilt with it, loaded it on my rack and by the time I got to that area of the quilt the mark was too faint to see to quilt by. Luckily I could still see it enough to retrace over it again with the pencil.
For transferring stencils I use a pounce pad. Remember you do not "pounce" the pad but rub it across your stencil as though you were erasing a chalk board. As Rose Marie noted the chalk line tends to bounce away as you quilt and what was a fine sharp line ends up being a blurry wide mark. I have only used the regular pounce chalk, not the ultimate you have to iron to get the mark out. So I can't say what the ultimate does. Like Rose Marie, I tend to dampen my surface prior to marking. I have heard, but not yet tried, that hairspray also works for setting the chalk and the marks will wash out. Don't think I would test that on a client quilt but would on one of my own.
I have also used the Clover chaco liner. But only white. I have had the blue embed in my thread and not come out.
Here is a link to a post I did some time ago showing my steps in deciding motif and marking a quilt, but I don't need to mark much. For example with feathers, I only need to mark my spine.
http://www.quiltingboard.com/picture...r-t121493.html