In which direction should bone axes be oriented? A total noob here I'm afraid. I've followed a couple tutorials in order to create a human mesh and set up an armature, however I've hit a roadblock with bone-rolling.

How should I orient the bones' axes so that I can successfully paste an x-flipped pose? I think I got the legs and spine working, but I have no idea which way the axes should be for the arms. I've messed around with the Ctrl+N bone-rolling option to align the bones in various directions, but I'm not sure what end result I should be looking for and none of what I've tried seems to work.

Here's an upload of the file: http://www.fast-files.com/getfile.aspx?file=78626

UPDATE: Problem fixed! Thank you for your helpful responses. Turns out I had a key issue of the opposite arm IK bone I was testing being named slightly wrong. facepalm But once I was clear on how the axes should be oriented and confident I had it right it was a lot easier to see what the real problem was. Many thanks!!
In Blender the Bone's local Y-axis always runs along the bone's longitudinal axis (from head to tail). I believe this convention comes from the definition of the bvh format. 

Regarding the orientation of the local x and z axes a typical approach seems to be to to orient all bone's local x axes along the global x axis. However this does only work for bones which have their local Y axis oriented mostly along the global Z-axis. 

So this general rule does no longer work when you have a character that is in T-Pose for example. In that case i found that a common approach is to orient the local z axis along the global z axis. 

I have made my own convenience rule of thumb out of this: 

for mostly vertical bones: orient their local x axis towards the global x axis



for mostly horizontal bones: orient their local z axis towards their global z axis



These rules of thumb worked for me in most cases so far. The only wonky situations are where a bone is half vertical half horizontal. I think i then used the same orientation as the other bones of the limb have.