In terms of other software: What's been listed here covers it. I also have another ISO/image mounter utility.
I don't bother with the disk copy 6.5 beta because mounting DMGs on Mac OS 9 isn't valuable to me, I have OS X Macs for that. I do have an OS X system with Classic Mode available so I can re-image DMGs as DC6 files should one that was made inappropriately show up.
I use mostly stuffit 5 on my OS 9 machines and, again, I have an OS X machine to bridge the gap between the modern internet and OS 9, so OS 9 can bridge the gap between my ~2005-09 Macs and my 1990-95 ones.
We're basically at the point where people who have a fairly wide interest range will likely need to consider having more than one bridge Macs. For my purposes, I have a Mac running 10.6 that I use both for ~2009-11 era Production(TM) software but also for translating files to and from formats compatible with and suitable for vintage Macs. 10.6 is the newest version that can connect to my ASIP6 server (this applies to the built-in file sharing too) but the reverse isn't true, so I use my OS 9 server (and again this could be 10.4, NT4/2000/2003, or Linux/BSD) more as a hub than an actual bridge.
I do have a handful of Macs that "need" AppleTalk specifically (as opposed to IP over ethernet) so it bridges in that way, but if I had, say, a big system 6-and-earlier contingent I'd high key consider an even older bridge/hub. (or again: linux/bsd)
I tend to install the regular software I'm using on bridge machines, plus file translation tools like GraphicConverter, QuickTime Pro suitable to whatever OS version you're running or slightly upgraded, Office, newer version of ClarisWorks, etc etc.
In terms of actual process, because I do have that OS 9 file server set up, I actually do a lot of my grunt work in a QEMU-PPC instance that runs in the background on my main personal desktop. I have separate ones for OS X 10.4 and OS 9, but I might at some point pop classic mode into the OS X one, mostly to get the logistical benefit of "shutdowns work correctly" while still having the option to fire up the dedicated OS9 instance.
I would probably adapt my ASIP6 instance to QEMU but I haven't bothered getting direct IP networking to work so my QEMU instances are NATted within the Windows box I run 'em on and can't be servers. (I also don't actually know if it's possible/reasonable to P2V an existing ASIP6 instance - as I mentioned in my previous post I don't really recommend ASIP6 unless you need private home directories or more than ten concurrent connections, both vanishingly rare circumstances.)