I boil my 2-3gal batches on the electric stove but mash in a 3gal water cooler with a braid. Except last night I actually mashed on the stove exactly like Sean's pic, using a grain bag. I did a small 1gal batch and didn't feel like breaking out the MLT for that.
I've stovetop mashed and used the oven, and I always had problems with temp fluctuations. Last night's mash went pretty well though.