1.用He was born on March 5,1988 in Shanghai.最佳.
如果用He was born in Shanghai on March 5,1988.也勉强可以,不过以第一种最常见.
但是用He was born on March 5,1988,Shanghai.就不行了.
该句后面是两个状语:时间状语和地点状语,所以都必须用能做状语的介宾短语,单独的专有名词Shanghai是不能做状语的.
2.March 5,1988中间最好用上逗号,不过也可以不用的,只是比较少见.
至于那个the,也是最好要读,不读也可以.
甚至可以直接读成March five都可以,口语是没有这么多限制的,只要对方能理解即可.