Multiple page books should be set up as separate pages in the file with .125 bleed on all four edges. The page size you select should be the finished size of your booklet.
Create the pages so the order is sequential. Do not place single pages next to each other in spreads. If you have an odd number of pages, add blank pages so your total page count is multiple of 2. Even page numbers go on the left. The cover can be set up as single pages as well.
If you do choose this type of binding one thing to consider while setting up is the back gate margin. The back gate margin is the distance from the edge of the paper on the binding edge to the edge of the hole closest to the paragraph where no live copy can be placed. This is set by wire size.
Wire size is set by using a simple formula of (book thickness + 3/16" ) this allows room for pages to turn easily.
1/4" to 9/16" wire-o is a back gate of a 1/4" of a inch.
5/8" to 1" inch wire-o is a back gate of 3/8" of a inch.