The upper bag on the Hollywood bike IS sitting on the fender. The plywood base has a small recess (not a hole) carved into it so that the bottom of the plywood cups the fender. It is then bolted to the fender through the plywood. This is the way I did mine.
The side bags are then bolted to the vertical fender brace, which is a custom made brace of wider steel.
If you're installing bags, this is what I recommend;
1.) Make sure that your rear wheel is trued nice and straight. Tolerances get tight back there.
2.) Carve the recess out of the plywood base and bolt the upper to the fender, (I used 2 bolts lengthwise along the fender about 2" apart.)
3.) Make the vertical fender brace out of strip steel or aluminum. It goes inside the fender, just like a normal brace would, I also ran it on the inside of my skirt guards.
4.) Mount the side bags to the fender brace with 2 bolts for each bag, one near the top of the brace, one near the bottom. The top of the side bags should be touching the bottom of the upper.
5.) The side bags may sort of bow out at the rear, you can pinch them together, and drill a hole through the inside of the upper (near the rear of it,) and through the top of the side bags, then bolt them. A helper is useful for this step.
This method is very sturdy, I have literally zero wobble in my bags at all. Hopefully this makes sense to you guys, I plan on making a video tutorial on this soon. Also, pro-tip, don't fit your side bags while the bike is on the kickstand. The may look straight, but they're probably not. Learned that one the hard way, lol.