Can anyone give me some insight on how you allocate practice minutes?

I do the let CPU do it most of the time, cause im pretty new to the game. 

Also are there diminishing returns, if you put too much into a category?

I recommend putting 100 minutes at least into individual stat practice and leave the rest to formation.  However, as formations don't mean as much according to conventional knowledge.  I think you should consider where and how you want your players to develop.. and adjust accordingly... like if you run a chuck and duck offense you probably want to make sure that there is a lot of speed at wideout.  Or consider where your players are weakest and 'grow' them.

There are diminishing returns for practice.  15 minutes is the 'sweet spot' from what I have read and learned.

I max out at about 25 in key areas.  Usually about 100 into individual practice.  Try to grow the areas that you value.  Some are no brainers (Blocking for OL), others are debatable and dependent on your philosophy.