It really depends on your actor's background. Having acted on film, television, commercials and stage, I've worked with several directors and received lots of direction. It's helped working as a director and AD. So I will speak from both hats.
If you are working with an extra or someone with little to no experience acting, it helps for you to be able step into the role and act it out for them. Then have them step into the role and try it a couple times. An untrained/inexperienced actor will have limited range of delivery. Don't expect more than they're capable of providing.
Actors who have worked predominantly stage have been taught to overemote which on camera looks over the top. Stage and sometimes television actors tend to speak louder than normal. This can really throw off your sound if they're paired with an experienced film actor. Here, table readings can be a big help.
The other difference with trained actors is they tend to use techniques. This can be useful for directors guiding new actors by providing them experiences that they can map over into their performances, especially with children.
For experienced actors, they will generally be flexible. Understand that we put time into building the backstory for our characters and try to imagine how they would respond. Often we "get into character" on the set. It's not that the actor is being confrontational when s/he says that's not what the character would say, but an expression of the internalization of the role. In that case, the best way to approach it, as director, is to say "In this scene, I feel the character needs to feel X. How can we bring that out?" What this does is it engages the actor while in character to bring out the emotion in a way that is consistent with the rest of the performance. If you simply ask the actor to "do X" it will look artificial and disjoint from the rest of the acting. Worst case, it breaks the flow of the scene as it will appear 'out of character'.
The other piece, of course, is ego. Actors have pecking orders. Leads and supporting trump SAG day players trump non-union day players trump SAG extra trump non-union extras. On big productions, the director only works with the leads and supporting actors and the rest are handled by the 1st AD. I've acted on SAG sets and seen some of issues that can arise. Generally though unless you are working with actors with lengthy IMDB credits, most are open to feedback to improve their performances.
First, while some non-union actors can give attitude, the belief that all actors are narcissists is false. The same can be said of directors (and screenwriters!). As an actor, having to deliver the same lines for multiple shots (OTS, CU, MED, 2P, etc.) under sometimes hot, blinding lights in hot costumes can be demanding. Having been the guy holding the boom mic and camera, I know they're equally demanding! The director, however, is simply watching. Important, yes, but not as physically demanding. I know on productions, the director is often also the camera man. Been there.
In that respect, new directors tend to be the worst. I had one director that had us shooting almost eight hours straight without a break. PLEASE! Give actors a break. They need to drink, piss, eat, and rest. Hoping to get the perfect shot from exhausted actors is not likely. Tired actors are cranky actors. No amount of positive corrects for tired, just sayin'. SAG actors will simply walk off. After you sign a SAG ULB agreement, don't piss off the SAG actors or the union will be calling. Also if you aren't paying the actors, it really benefits you to be nice.
Also as the actor, you don't have the benefit of seeing yourself while acting. If as director you're going to correct an actor's actions, show them the clip and point out what you want. It helps immensely. Saying "move your hand more to the left when you deliver that line" is pretty inexact. If you can't show the clip (which use to be the case with film but DV has changed that), the director should demonstrate it or help mark it out on the ground.
Realize that you cast the actor to give their interpretation. Casting is an important decision. Looks should not be the only aspect of that decision. I know some writer/directors are so wed to the image of the character in their script, that they get inexperienced actors simply because they look the role. Acting, like screenwriting and directing, is something that improves with practice. You start where the actor is and help them build the character. Buddies or family may not have any acting experience. Be gentle. Make sure the script has adequate description for the actor to create a believable character. Directors who choose not to do that, often bring in acting coaches. Just as some bring in script consultants.
So as for the original question, "how do you give feedback to the actor whilst remaining positive and not insulting them?", the answer is appreciate that they are interpreting the character. And if acting for free, that they are contributing their time. Be direct and say "That's good. What I want to capture on camera is X doing Y. It would be something like <give example>. How do you think the character would do that?" Let them emote and if needed, "Okay but there is more/less energy. What would that be like?" If still off, "I need you to imagine that this character knows/learns/believes Z as s/he starts the scene. Take a second and try it again." You might need to repeat a couple of times. Use all of the previous suggestions tailored to your actor's experience. Actors try to please but at some point you run up against the limit of that actor's particular ability. Then you have to take the best of the shots. Good luck.