It works very well at low latencies (~5ms) with alsa-utils, jack2 and linux-rt. Running on ALSA only with the standard kernel may cause crackling at lower latencies.
To be recognized and work, the firmware version of the Babyface needs to be >= 200, which introduces the Class Compliant Mode. To enter Class Compliant Mode hold the "Select" and "Recall" buttons while connecting the Babyface to the computer via USB. It should now be recognized.
To check if it is recognized:
$ grep -i baby /proc/asound/cards
For more info about the Class Compliant Mode visit RME's website, they have PDF which covers all the functionality.
The Babyface does not need any special Jack Settings. But if you want to use the built in MIDI In/Out then you need to set the "MIDI Driver" to "seq" and optionally disable "Enable Alsa Sequencer Support" to use it in combination with other MIDI Devices (a USB Midi Keyboard for example).