Rule #1: Teams from the same division cannot meet in the first round. Mindful of Rule #1, the League seeds division winners 1-3 based upon record, issuing a 4 seed to the wild-card team, regardless of its record. Usually, first round match-ups pit the 1 seed against the 4 seed, with the 2 seed taking on the 3 seed. But if either of these match-ups result in intra-division play, then the opening round re-seeds, as follows: 1 vs. 3, 2 vs. 4. In the first and second rounds of the playoffs, the better seeded team has home-field advantage, regardless of record.
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For the Division and Championship playoff series, the team with the best record will have the home-field advantage.
For a 5 game playoff, the schedule will be like this: Home, Away, Away, Home, Home
For 7 games, the schedule will be like this: Home, Home, Away, Away, Away, Home, Home
Even though many people don't really pay much attention to the All-Star game, it's a very important game for the players, because the league (American or National) that wins the All-Star game is the league that gets the home-field advantage in the World Series.
For many, many tears, an old married couple made the schedules by hand. About 5 years ago, MLB decided to just let a computer do it.