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I have been messing with a p2pool which I like (no fee) but has latency about every week causing the miner to stop mining altogether. I would like to employ some kind of failover strategy so that the miner will mine somewhere else if unable to connect to this free p2pool, but I would like to be mining on the primary pool as often as possible.

I have tried looking at the multipool settings, but they weren't very informative in terms of what happens when. If I set failover does that mean that it will only connect to the second if it can't connect to the first? If not, is there any way to set up cgminer this way?

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Yes, the failover setting will tell cgminer to mine on a secondary pool when the first pool is unavailable. Run cgminer with the following:

cgminer.exe --scrypt -o http://p2pool.org:9327 -u username -p password --failover-only -o http://backuppool.org -u username -p password

This example mines LTC at p2pool and will mine at another pool of your choice when p2pool is unavailable.

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Asking for tips in posts is not allowed, but you may post your addresses in your profile. See the meta question here: Is it okay to ask for money donations in an answer? –  Murch Feb 16 at 18:39
    
After failing-over to the backup, does it occasionally check that the primary pool is available again and then switch back to the primary? –  michaelmoo Apr 14 at 5:13
    
It checks for the main pool very often and reconnects almost instantaneously once the main pool is back online. –  Mark Apr 14 at 13:53
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