Heat & Bond was not designed for applique. It is meant for general crafting. The adhesive is far too stiff and gummy for needle work, either hand or machine!
I always use Wonder Under by Pellon. It doesn't add stiffness to fabric and does not gum up needles. It is sold on the bolt in the interfacing section of stores. Wal Mart used to sell it, not sure if they still do. I buy mine at the LQS where I work.