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Correction gels are mainly used to balance out the flash temperature with the ambient temperature. But you can also use them to change the ambient and control the flash.
The white balance setting on your camera will depend on the effect that you want to do.
If you are playing with kelvins a good tip to keep in mind is:
Warm it up and Cool it down. Raise your kelvins to warm the image, lower the kelvins to cool the image.
At a kelvin of 3200 the CTO is corrected because when you lower your kelvin you are telling your camera that you are shooting in very yellow light so it adds blue to correct it, hence neutralizing your gel.
If you want the gel to be exactly as you see it you can put the camera on daylight, or 5500k. This will tell the camera not to correct the WB and will show you the true effects of the gel. When you set your WB to flash, you are telling your camera that you are shooting in a little bluer light, so the WB in your camera will actually add yellow to compensate. So if you have a CTO on your flash and you set your WB to flash it will be "warmer" than the CTO gel is.
Hopefully that makes sense. Just remember that the WB on your camera is actually a correction and it's opposite of the true color temperature of light. So when you are adjusting your cameras WB you should be thinking backwards.
For example, a candle is very yellow light, in reality the kelvin temperature of the candle is around 2800 kelvin. But in your camera if you where to set it to 2800 kelvin and you aren't shooting in candle light, then the photo would look blue. This is because the WB is actually a correction and adds the opposite color of what you are shooting in to correct the whites.