I generally am not starching the finished block - I starch the fabric before I cut. And I love the control that starch gives - I get more accurate cutting and seams with starched fabric. I am pressing each seam as I go as well as the final block, and I do use steam.
For squaring up, I like to find something in the block that marks the centre or aligns somewhere. I really like using a rotary cutting mat for squaring up so you are not picking up the block, just turning the mat.
Good for you for squaring up - took me a long time to see that this step really helps ensure your finished quilt goes together well.