Variable dobts:- Do I need to hard code values ($host, $rmote_addr , $proxy_add_x_forwarded)

Server NGINX
1

Hi
I am trying to configure nginx for reverse proxy,my intention is to
have load balancing, On 192.168.20.59(CentOS) I have nginx installed. I
have two machines(192.168.20.59 and 192.168.20.208) running IIS.

My Test environment is as shown in the map

|
============= |---- rac1.mydomain.com
| LAN | | 192.168.20.59
============= |---- rac2.mydomain.com
| | 192.168.20.208
| |
| |eth0 → 192.168.20.34 ------/
|-lb0==| /
| |eth1 → 192.168.20.44 ----/
| | eth1=virtual IP address
|
|

|LAN Connection |

I am referening book "Nginx HTTP server ", Chapter 7 + other related
google search results. I have doubt in the variable setting, do we need
to hard code the value of does the program take it from any other
parameters.
My doubts are how I am getting values for $host, $rmote_addr ,
$proxy_add_x_forwarded_for(part of configuration files I have cut and
pasted); Do I need to give the real IP address itself instead of the
varibales ($host, $rmote_addr , $proxy_add_x_forwarded) in the
configuration file

PROXY - Web

location / {
proxy_pass http://127.0.0.1:80;
#proxy_pass http://192.168.20.34:80;
proxy_cache cache;
proxy_cache_valid 200 24h;
proxy_cache_use_stale error timeout invalid_header updating http_500
http_502 http_503 http_504;
proxy_ignore_headersExpires Cache-Control;

proxy_set_header    Host      $host;
proxy_set_header    X-Real-IP  $remote_addr;
proxy_set_header    X-Forwarded-For $proxy_add_x_forwarded_for;

}
##############
Please advice me
Thanks
Joseph John