I recently made a series of posts about how I tuned my CNS carb to run really great, here is a link to that thread.
http://motorbicycling.com/f4/cns-carb-working-great-32736.html
As for your idle going up and down, couple things could be at play here.
1) the clutch could be putting a drag on the engine and killing it. This drag could be a bit variable, for instance, when you rotate the handlebars the clutch cable may tighten or loosen just a tiny bit causing more or less drag. This can be responsible for the change in idle speed. If you are having a hard time getting the clutch adjusted properly check the nut on the drive sprocket to be sure it's tight, that nut pulls in the internal spring on the clutch. If that nut is not fully seated the spring is not compressed enough and the clutch will require too much travel to operate properly with the clutch lever.
2) Similarly, if your throttle cable has any sharp bends it may be hanging up a bit and not returning to the home position all the way. Turn the handlebars, see if the idle changes, wiggle the throttle cable where it goes into the carb also to see if this is a source of problem.
3) You could have air leaks in your carb, where the carb mates with the intake, where the intake mates to the engine, or at the exhaust. Air leaks would cause a motor to run erratic.
I commend you on your choice to move the needle downward, that was the right decision which is confirmed by your improved mid throttle response. Read through my thread linked above to see what I had to do to fix the rest of the throttle range....