For most of the game the Iron Flask’s Spectator is a High Risk/High Reward item that isn’t really worth using since the risk is just a little too high. That said, by Act 3 the enemies that you face and their number transform it to Low Risk/High Reward since they have a really good chance of killing it in 2-3 rounds. Two fights in particular benefit from using the Spectator to tie down enemies: The battle with the Wizard in the Lower City Sewers and the Battle in the Courtyard leading to the Elder Brain. For the first in the Lower City Sewers the battlefield is split by a bunch of bridges and has a bunch of difficult terrain. Just toss the Flask onto one of the bridges and let it lock down 1/4-1/3 of the enemies in the fight. The Courtyard fight has a similar logic but here it’s just numbers. If you position it in the upper left courtyard it can lock down the whole left side for almost two rounds before they kill it.

Using the flask during the fight to protect Isobel at the Last Light Inn would probably be the most unhinged. Kinda like throwing a grenade into a room full of hostages.