How do you use the crate for a ’time out’ for a dog that has done something wrong?

It shouldn't be a problem because you don't say anything to the dog, you just take them by the collar without any emotion and put them in the crate. It's more of a mental break for the dog and human, if it's done without emotion it shouldn't be an issue.

If you find that you are having to use time-outs all the time, then it's more about re-evaluating your training and management plan. I might use this once or twice over a several-month period if at all. Some dogs never need it.