Samleung,
That sounds reasonable. I always set the arm parallel to a 180g LP. I have the feeling that the bottom end of the stone is not parallel to the LP in this case. Maybe it's a design feature. What are your resistor and caps values, unless you are using a Koetsu step up transformer?
Samhar,
There must be some system setup issue, if you are happy with 1k. You should try something about 100 Ohm.