I’ve used funnels a few times just fine. (a)ctivate them, select a nearby spot, and drop a water bottle on the same spot. I’ve done it with 2-drink bottles, canteens, gallon jugs, etc. I don’t think there’s a gradual-fill mechanic; just at some point your container will be filled with water or acid water.
I find it’s best not to set them up during the rain. Set them up before the rain, while you’re settling in to read some books, do some crafting, or sleep off an addiction. Or just if you’re establishing a base and plan to be back and forth a noteworthy number of times.
(Anyway, I feel they’re not really a valuable source of water. They generate dirty water or acid water, not clean water, so you still have to purify it. And at that point why not just use one of the many places with infinite water sources as a base. Like a mansion or LMOE shelter. Or just somewhere near a riverbank, or swamp.)