Can't really say who's correct or not, one needs to calculate the second moment of area of the steel stock that you're working with, if you're buying the stock from a reputable dealer they should have tables available, for weight per length and the second moment of area.
Both box sections and round sections are used extensively in making frames today. Compare the frame of a Cannondale or CR to that of a Banshee or old school YZ. Big difference in physical dimensions...
A box section can be made to be stronger than a round section, however, due to the extra weight involved in the box section, the engineer choosing a box section will have to choose a lightweight metal.
The thinner the wall thickness, the larger the outside dimensions required.
IMO the stock that 99screaminshee is working with, can be made strong enough, with the gussets in the correct place.
Do not try to bend the square bar.
Some tips:
Try to fit the ball joint for the upper and lower arm in the horisontal position with the shocks sagged to the rider and bike's weight. This will prevent the ball joints from binding at the extreme ends of the travel.
(Thanks for the pic Stu)
Do not try to bend the square bar.
At the shock mount on the lower arm, drill a series of holes along the shock mount, to enable different ride heights and use different shocks. drill the line of holes parallel with the lower arm.
Hope this has helped, try to post some pics of your project!