I set the drop at nominal.
Just wondering if one position is better than
the other. Is there going to be more fuel in
the bowl if set at 1 1/8 or less?
Provided the float drop is between the max an min figures it will be just fine.
If it does not drop far enough the valve will not open fully and you may be starved of fuel'
If it drops too far there is a risk thet the needle could fall out of the seat or be pushed sideways and jam
The most important adjustment is the float level. You may need a special tool to set that precisely but with the carb body inverted and the float just resting on the needle the float should be parallel with the carb body to float chamber joint . Its not super critical.
If you have a soft tip needle be sure the clip between the needle and the float arm is in position.
There is a good video, with float adjustment details towards the end, by Stuart Allen of Dangar Marine here .