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Best way is to turn the idle up just enough to run on one cyl. remove one plug wire and ground it. Now with the engine running on one cyl. turn the pilot screw in until the engine runs rough then back it out again until the engine runs rough counting the turns between those 2 points where it runs rough. The best setting is 1/2 way between those 2 points. Repeat for other side.



Is there an advantage to doing this with the plug out, so as to avoid vacuum drawing fuel and flooding that cylinder?
That's how I have done it, but I'll be honest, I have found it difficult to notice where the running cylinder gets rough; it happens gradually both in and out. I don't see how there would be a difference in how the running cylinder performs with either method (plug in vs out on dead side).