My answer as the clerk is that they can sit where they like, but to be truthful, they still sit by party. The minister sits on one side and the shadow minister on the other side, and members will generally sit by party.
I think the physical layout helps. It is presided over not by the Speaker, but either by one of the Deputy Speakers or more normally by one of the panel of neutral chairs we use to chair our committees on bills. It lowers the temperature while still enabling some passionate, well-attended, and interesting debates.