Outside. Silicone rubber was used to glue the pad on.
The new dampener material at Sick Bike Parts and others works amazingly good. Pads for clutch, magneto and clutch cam cover. It's a highly viscous material that sticks and dampens vibrations. It has a heavy mylar backing. All you do is peel the paper backing off and stick it on the cleaned interior surfaces. This works good. Tap a cover and it just sounds dead, no metallic sound.
I used small chunks of the silicone hose that comes with a SBP expansion chamber to stuff between the fins. The silicone rubber is very heat resistant which is why SBP uses it for their expansion chambers. I have their expansion chamber and got the add-on muffler, makes the bike reeeal quiet.