Ya know, that's funny ya mention the winding of the bobbin... I never gave that another thought. But, I don't think that is properly tensioned or winding, come to think of it. I will crap a brick if that's what it boils down to! LoL! It winds heavy on the outside and thinner on the inside, a lop-sided look to it. How do I fix this?

Forgot to add, it's not loose when it's wound but could be a bit too tightly wound. Also, it uses a stand-alone winder like the gammill video I saw on YouTube, it's identical to mine.

While I haven't found a solid solution, this is what I did find after trying the tips from PaperPrincess:
Don't ask me why but, skipping that middle hole sure did help.. a lot, by reducing some of the drag before the tensioner.
I also loosened the upper tension and tightened the bobbin a smidge, result: a few tiny loops here or there on the back but no broken upper thread for one complete pass. Yay! even though it was short-lived success.
I am still working out the lop-sided bobbin problem with small adjustments to the position of the tensioner on the bobbin winder. It's getting better.

I did setup the camera while I was testing these out, to see if I could pinpoint what happens right before the thread breaks. I came to the conclusion that the current thread stand on the back of the machine is a likely culprit. Maybe the culprit..? It seems the thread wraps around it when there is a big loop from slack(?) at the other end of the machine and then the thread catches on an invisible but feel-able knick, just as it passes thru the eye of this thread stand. That causes the thread to catch there and thus snaps it over at the needle bar. Does that make sense?
Here is a pic to help describe it. This is before I moved the thread back to the smaller pole(where it's s'posed to go but thought I'd try something different by putting the spool where it was originally designed to go). The black circle is the thread stand, the black arrow is where the thread catches after looping over the end of it. The white x is where it breaks, right before it goes into the guide, that's not really visible, directly below the x.

Maybe this will help someone else, I sure hope so after trying to figure it out myself. I do appreciate all the advice, tips, and suggestions from ya guys. Each one I try, and I do try all of them, seems to get me closer to actually being able to sew for more than 5 minutes at a time. If I come up with anything else that "works", I will put it here. If ya got anything else, no matter how ridiculous ya think it may be or just a thought about what to try.. please put it here. I will keep trying them all.

I just never realized how many small things go into quilting on a frame to make it work! It's not so simple as just loading it and letting her rip, I can confirm that. Here I thought all ya LA'ers had it easy, and boy do I apologize for that assumption. Thanks again for the help!

Hi, yes, a nick that you can feel should be delt with. You can use crocus cloth or garnet sand paper (check at hardware store) to get rid of it. If the thread on the spool is coming off and either puddling around the bottom of the spool or causing a loop to form I would try using a spool net.
Looks like this:
http://www.amazon.com/Threadsrus-Thr.../dp/B001U5A0Y0

I use the stuff that encases garlic cloves from Sam's Club. You can also ask at your local florist. Large flowers often come from the supplier encased with a net that is discarded.

Also, there is a manual on the Singer site for a 96-80. It looks very much like your picture. If you scroll down to page 11 there are threading instructions. The thread path thru the 3 hole guide is unique. I've never seen it done this way (in and out, rather than a spiral)
http://parts.singerco.com/IPinstManuals/96-80_100.pdf

You never mentioned the bobbin tension. You need to loosen the bobbin tension as much as possible before adjusting the top tension. For high speed machines, looser is better because thread stops breaking. If bobbin tension is loose, top tension can also be loose to get a balanced stitch.

A larger needle can help with breaking thread too. Many frame quilters use a size 18 needle.

But, watch the video! I believe his recommendations apply to all machines used for frame quilting. I could not get my bobbin tension as loose as he demonstrates; the screw in my bobbin case fell out first! However, I did make sure it was as loose as I could get it and still keep the screw in.

You hadn't mentioned that you took it in for professional servicing. So I didn't know.

I would also try a larger needle.

To me it looks like you're not putting the presser foot down.

Yup, in the photo it's in the raised position.

If you were sewing with the machine exactly like it is in the pic on this post you are sewing with the presser foot up. That means your tension disks are not engaged at all and the only tension you have is the three hole guide.

I have a Juki TL98QE with the three holes like yours. It says to use the first and third holes for regular thread. Only use all three with nylon or when sewing very light weight fabric and thread. Presser foot must be lowered when trying to stitch or you will get a mess on the bobbin thread. You are getting very good help.

Oh no, on this machine, the needle will not go all the way down if the presser foot is not down. It sits above the bed about 1/8th of an inch when down. The reason for this is because the presser foot does not bounce or move in any way while sewing and there are no feed dogs. If the presser foot is lowered to the bed, the machine will not move freely over the sandwich with it down. It is high-shank and I have no other feet for it so have to use what she had on it. She had it set higher up than the 1/8th inch but it didn't seem right to have it 1/2 inch off the quilt sandwich like she did. I have never seen a foot like this one so wasn't sure it was actually a proper foot! LoL