Why plummers putty and not the rubber gasket, all direction says the only place the putty should be used is in between top lip of drain pipe and sink. If putty is to be used should it be used without rubber gasket?

Sounds like you are installing a new pop-up assembly for a lavatory sink or a strainer for a kitchen sink...yes?

If lavatory sink, putty is used between the lip of pop up assembly and sink basin. Putty is not used anywhere else on the lavatory drain assembly.

If sink strainer, then rubber gasket goes UNDER the sink... not inside the sink under the strainer. Putty only gets installed under strainer lip... then rubber gasket and cardboard or plastic gasket (if provided) go underneath the sink

If sink strainer was provided with a rubber gasket for the top and bottom then you can use both or discard top one and use the putty.

Never use putty AND the rubber gasket.

You cannot use putty on marble or granite sinks or countertops... oils will discolor these materials over time. In this case, use of the rubber gasket or use of a silicone caulk will work better.

Let me know if you need more...

Mark