I think what you really need to do is pull the entire skimmer oput of your tank. Clean it all up. Set it off tothe side and get th elatest copy of instructions in front of youo, grab a cold beer or other drink and take yopur time in re-setting it up inthe tank. It has to be somehting your not doing correctly, as there is just too many of them out there in use that work perfectly if they are set up correctly.
You stated you had to block off the air bleed hole on the outlet tube...well thats a sure sign of the discharge end of the tube being submerged into the tank water too far, or being restricted, the pump is submerged too deep in the tank, or yur air silencer has water in it, ot the air inlet line is sucking in water as well, or may be even your needle wheel has junk wrapped around it.....The way thaty bleed
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is made and on that discharge pipe water has to back uop from the discharage end to be able to enter and push up through that
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, so odds are you have the discharge end of the outlet to far in to the tanks water level, or your foam sleeve you use for bubble diffusion is clogged up and dirty.....
You know you may think your turing it way down but its not, as that red knob can be pulled up and rotated and pushed back down again. and it will change the shutoff locatin. Set water / bubbles i the reaction chamber to about 1" above red retaiing ring.