I have the same machine, and have used it exclusively the past year and a half. Yes, mode 1, 3.5 stitch length, and reduce the presser foot pressure to about 1. I like to use a sample sandwich and try out the design I plan to use, adjusting the tension as I go til I have it where I think it needs to be.
If I had one thing to say about FMQ it would be to press down firmly with both hands as you go. I find I have very good control doing so. I agree with you re the stitches not being as perfect as I'd like to see them...a bit of OCD here. lol I'm not using any special bobbin case, but have recently switched to a topstitch needle and plain old cotton quilting thread and really like the difference those changes made. I know...more money out. I have a big supply of "special" threads, marking pens, rulers, cutters, mats, etc, but find it's probably best to just stick to the simple things and go for it.