Bailey goes 100% outside - in all types of weather. (she has a rain coat and a winter coat) It works for us. Our back door is right off the living room. If I had an apartment or if getting to the outside wasn't convenient, then pee-pads are the answer.
As far at Bailey letting me know when she has to go outside - we taught her to ring a service bell. It works great and gets lots of laughs.
Good luck!!
