To check and see if a propeller is balanced or not. Give the propeller a gently spin on the balancer. If the propeller is balanced, it will come to rest at any position on the balancer. If one of the blade on the propeller stinks down, this indicates that one of the blades is heavier than the other and that the propeller is unbalanced. If the propeller comes to rest in the horizontal position, this indicated that the hub is heavier on one side.
To balance the propeller, gently spin the prop and wait for the propeller to come to a rest. The heavier blade will stink down.
In order to balance a propeller, material needs to be removed from the heavier blade. One method is to take fine grit sand paper and sand the back side of the heavier blade until the propeller is balanced. I choose to use a razor blade or X-ACTO knife and shave off the back edge of the heavier blade. Either method you choose, repeat the process until the blades no longer stink down.
Here is a video explaining how-to balance a propeller. He is using the Du-Bro Propeller Balancer. This is a fine propeller balancer, but I recommend the Top Flite Propeller balancer. It is cheaper and works great.