The idle adjust screw I'm referring to is on top of the TB...regardless of what your Tech friend says (if he's even talking about this screw), it should be fully closed on the 7M. It specifically says so in the TCCS book I have.
The dashpot screw is a different story...it is not an idle adjust screw per say, but enables the dashpot to keep the TB plate from snapping shut. Primarily for emissions, but also to help the transition to idle.
This was simply another vac leak...it is not possible for the EGR to stick open due to vac. The source is on the IC pipe side of the TB plate...vac can only get to the EGR modulator if the TB plate is open (above idle). A bad modulator will cause the EGR not to function at all though...vac is applied to the modulator from above idle to ~4000 RPM where the EGR VSV gets a signal to cut vac from the TCCS. Based on what you've said, it is highly unlikely the EGR is affecting your idle.
Ummm...not even close. On the 7M it works like I described above. In that RPM range, exhaust gas displaces air in the cylinders...remove it and more air is allowed in by volume. That means a lean condition is possible in the EGR activation range = detonation under load.
Plus, like tlo86 said, the EGR helps gas milage at cruise and it has zero effect on total HP produced since it is inop above ~4000 RPM.
Might want to start listening...I know what I'm talking about on this one