Why do you quilt over the applique? Just a thought. If it's a must, Then going by what I've learned it is the needle. You need a needle made for thicker fabric, as with applique you are going over several thickness's. When I'm sewing several thickness's I use a machine needle made for denim. (jeans). I've made several rag jean quilts and I've not missed a stitch by using these needles.