Should 127.0.0.1 and ::1 both be included in /etc/hosts file

The correct way is to put the hostname after the address you want to resolve it as. This usually means the external address unless you have good reason to use the loopback address instead.

Putting localhost in /etc/hostname and

127.0.0.1 localhost.localdomain localhost

in /etc/hosts is fine. The mappings can be set in DNS, and you can set the rest explicitly (apache will have ServerName configured inside virtual hosts, etc).