My husband and I bought some 6'x8' tarp from lowes in the home and garden section and put that over our regular carpet and then a carpet remnant from lowes (again 6'x8') over the tarp. It was really cheap to get the carpet remnants so as not to mess up the regular carpet when Baloo has accidents since we live in an apartment. Then we set up the x-pen for Baloo, with his crate at one end and his pee-pads at the other end.
To train him to go on the pads we put his leash on him, stand inside the x-pen with him and make sure that he is always on the pads and not wandering around the pen. Or we sit with him and move ourselves to block his path so he doesn't leave the pee pads until he does his thing and then praise and give him treats. The best time to teach him what the pads are for is right after breakfast or as soon as you get up in the morning. So far this has been working really well, but there are the occasional accidents.