Should I cover or hover?

Hovering gives a better vantage point (better LoS), can trigger the "Height" bonus if you're high enough, and additionally acts as low cover (-20% chance to be hit, just for flying).

If high cover is available, that might be preferable, or if you need to hunker down (not available while flying).

One other thing to note is that Sniper's don't benefit from Low Profile when flying, so you might find them getting hit more often than you're used to, should they start taking flak.

If no cover is available, you should always be flying.

if you click more info when aiming at an enemy you can get a breakdown of what mods are in effect for that shot. One of Elevation is one of the positives. Additionally, snipers have a perk that gives them bonuses "from high ground" and flying counts.