If you bought yours in 2001 as well, we definitely have the same machine. I've only used the embroidery once on it and only did SITD quilting on it until I bought my longarm. Has your bobbin case ever been changed out? Last time I got mine cleaned, they said the bobbin case was worn out.
I can't remember which YouTube video I watched that went through explaining which needles to use, but she recommended using a top stitching needle for doing FMQ. Not sure why.