To take full advantage of pack instinct you'll want to use 5 level 1 pets. If you level 1 of them up to 2 or 3 slots the damage increase of pack instinct decreases to an amount less than you gain by leveling the pet. Most people have used 5 wolf spiders or 5 hell hounds for this. Works best if you have a friend with a pet that can tank the mob for you.
Next best would 3 1-slots, with a 4th on of the same type optimized by the level of training to a tank (HP, Resists, Base Damage, maybe some HP regen and mana, leaving skills and abilities alone other than maybe adding AI to compensate for not having the 5th pet). You lose about 1/4 of the pack firepower (the 1/5 of the 5th pet, plus the pack bonuses to all from the difference between 4 & 5), but you gain a more reliable tank for hunting alone.
You can, if you have the slots, always just have 6 of the pets (5 1-slot and the one 2-slot), so you can change out from 5 to 3+1, or back, as your hunting situation calls for it. I wouldn't do more than one to 2-slot, in any event.
Flexibility is the key