I made a baby blanket out of the "puffy dot" minky in white and put a soft white flannel on the back. I used my embroidery machine and embroideried hearts on it for the quilting. I also monogrammed it on the embroidery machine with the baby's name and birthdate. I bought the white satin blanket binding and put around it. No problems, except for fuzzies.
I am now finishing up a quilt, throw size, for a little girl that had bunnies on it and I used white minky for the appliqued bunnies. Did the quilting on my embroidery machine without a problem.
Hope you can solve the mystery problem. I did use poly thread (Mettler) in the quilting and appligue on both quilts. Maybe you could try that.