I found out something interesting with my machine yesterday that I thought I would pass along. I put in a new needle and thread size and started the same issues as Nightshade. I followed the book about centering the needle in the hole with the adjustment screw and it turned out, after about three hours of messing with it, that I had to move the needle to the back of the hole instead of in the center and then everything worked fine. Maybe this will help you to.
Paul