First, thanks to everyone who has supplied many good ideas and answers to the questions. I did a lot of searching and think I have most everything answered, but did want to validate what I think I read and heard as I gathered the information from a bunch of different posts.

Our house was built in 1991, the flooring is 3/4 inch strand board, which if I understand right is not OSB, but particle board, which prior to the last few years is NOT good enough for direct installation of a hardwood floor. Therefore in order to achieve 1 and 1/8 total thickness, I should install a 5/8 inch CDX plywood over the particle board. I should ensure that any high spots in the particle board are sanded down first, screw down any noisy spots and then both glue and screw down the plywood with the sheets laying in the opposing direction of the particle board. The plywood should have the C side (best side) facing up with 1/8 inch between every sheet. Screws every 8 inches. Is that the correct / recommended method?

Second question - since the joists (pine 2x12's) run parallel to the long walls in the room, it is OK to install the wood floor (which by the way is Australian Cypress) paralell with the joists, as long as the first paragraph with 1 and 1/8 inch total underfloor is met.

Third question - Even with the plywood, I should still use the Red Rosin paper between the plywood and the wood floor. Is that correct?

Thanks in advance for your advice and comments.

From my days of selling it Strand Board was the precursor to what is now called OSB (oriented strand board). It had longer strands or chips if you will, but it was not considered particle board which looks like glued-up sawdust panels. You got a photo showing what you have?

If your floor joists are 16" OC you can run parallel after it is built up some.
On my jobs I use felt, others use red rosin or Aquabar B. NOFMA states using something there.

I did maybe miscategorize the subfloor. It is not particle board, rather chip board or the pre-cursor to OSB. In any case, as I understand not a suitable subfloor without a plywood layer.

New information is that I did have a conversation with an installer who would do the floor installation for me. He indicated that he would not install plywood, as he uses cleats and those would be good enough for holding things without needing plywood. Does that sound right? If that is the case (that they hold good enough), then would having just the early 1990 chip board (3/4 inch) as the subfloor be enough to run the floor parallel with the joist, or would I have to add a layer of plywood regardless since the only way the floor will really look good is to run things parallel to the joists?

NOFMA, the authority on hardwood flooring, does not recommend installing parallel to the floor joists UNLESS an additional layer of 1/2" plywood is installed first OR additional blocking between the joists is added. Your installer is just telling you what he thinks you want to hear. BTW, cleats typically do NOT hold as well as staples do. Studies have shown staples initially hold better, especially in problem subfloor materials like OSB. Now there are situation where one could install parallel to the joists but they are rare. If the subfloor material is 1" thick or thicker and the joists are 16" OC or closer. If the subfloor material is 3/4" thick or thicker and the joists are 12" OC or closer. Of course, you can do as you please as it is your home. I do recommend one follows the installation guidelines by NOFMA.