High,
Yes it is possible to keep them alive. Just make sure that you change the water often. The best way to rig them is with a live bait hook right through the aft end of the squid. They can still swim a little but they have an injured and vunerable look to them, that yells "free meal" at any passing fish. OTOH I have had live squid baits in the water and caught all of the tuna on butterfish, so you just never know.