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The receiver needs to be mounted so that it has a clear, unobstructed view of the sky. It will be fine through glass windshields, fiberglass and cloth tops. Keep it at least 2 feet away from the display unit.
I don't think your old fish finder is the LMS-332C GPS Receiver listed above in the description. You don't need the speed wheel for the fish finder to function just the transducer and transducer mount. You should mount that on the back of the boat towards the center but not too close to the motor and not too close to the side of the board. Don't let it hand below the level of the boat. That should keep it from getting hit by the trailer or dragging on the bottom. Try to make it as level as possible. The green and white wires may be for the speed wheel but i'd need a model number for clarification. Hope this helps.
False fish readings are commonly caused by electrical interference such as alternator noise, and by air bubbles flowing across transducer.
For starters make sure your fishfinder is on an independent circuit and not on one powered by your ignition switch. In other words, you should be able to turn your fishfinder on, even though the engine is turned off. Ideally the fishfinder should be wired directly to the battery with an in line fuse.
Try running the boat at a speed slightly higher than trolling speed, then kill the engine, as the boat slows down to trolling speed do you still see false echos? If yes then the problem probably lies with how the transducer is mounted, or where it is located on the hull.
If you don't see the false echos when the engine is off, it may be necessary to reroute the transducer cable to keep it away from the boat's ignition wires. You can get transducer extension cables if necessary. Also there are filters that you can buy that suppress alternator noise buy attaching between the battery and the engine.
Another common cause of false echos from electrical interference is a transducer cable that has been cut and spliced.
I hope this information helps. Please reply if you have any questions about my response.