The best positions for playing shakuhachi are standing or sitting on the floor "seiza style," on your knees. Both these positions make it easy to keep the spine straight and allow for an unbroken column of air in the abdomen and chest. If you can't sit on your knees, a wooden "seiza bench" or "meditation bench" may work for you.
For some people, sitting crossed-legged on the floor is the only option, but if you sit this way it is very important to make sure your spine is straight and your belly is not collapsed. In general, I don't recommend sitting this way, as there is a tendency to round the lower spine and sink down. This makes a strong breath and a long sound difficult.
Sitting in a chair can work just fine. Again, remember to keep the spine straight. Sit at the forward edge of the chair, not against its back.
Make sure that your music is at an appropriate height so that you don't have to bend your neck forward too much to see it. If you sit on the floor, place your music on a low table or a Japanese music stand; if you stand or sit in a chair, a regular music stand will work.
When playing, hold the flute at approximately a 45 degree angle relative to your body. Make sure the spine is straight, that your arms are hanging loosely at your sides rather than pressed tightly against your body, and that your shoulders are relaxed and dropped. When doing something difficult, most of us tense up in some part of the body. Once you get in position with your flute, scan your body for a few moments to discover where you are holding tension. Perhaps one of your shoulders isn't dropped, or an arm may be pressed against your body, or your jaw may be tight, or you may be gripping the flute as if it were the edge of a cliff. You may even be tensing a part of your body that is not at all engaged in the activity of playing flute, such as your legs or toes. Notice and let go. While practicing, it is helpful to do a full scan of your body like this occasionally to make sure you are as relaxed as possible.