Yes, the felt needed to go for sure. Sew-Classic.com has them at very reasonable prices. I picked up 1 for the FW and 1 for the 301. There are other Singer machines that use felts also. I agree with your de-mildewing approach. It helped my stinky machines and cases. Throw a cake of deodorant soap in the case when not in use or in the sun. It will hold your place in keeping mildew at bay. Safeguard or Irish Spring seems to work. Sun is the secret ingredient. The glue in the FW cases is candy for mildew. My 301 case was slightly smelly, but not as bad as the FWs. You will love the 301 as it is not as difficult as the FW and works longer with less fiddling. Congrats.