To adjust the idle, unplug the IAC and the spout connector on distributor. Then set for 650-700. If you try with spout plugged in, ECU may try to adjust timing which can effect idle.
I used the list compiled by Wayne Waldrep who used information originally put together by jrichker in the Surging Idle Checklist. I found the compiled list quick and easy to follow for the specific task of setting base idle. I have copied and pasted the Wayne Waldrep list below.
Now do the process.
1. Warm the engine up to normal operating temperature.
2. Turn all accessories off. Lights, radio, hvac, etc.
3. Unplug the IAC electrical connector.
4. Remove the spout plug at the distributor connection.
5. Start the engine.
6. Idle the car to 600-650rpm using the throttle blade stop.
7. Turn the engine off but leave the key in the on position.
8. At this point you can set the TPS. (I'm not getting into the TPS setting debate. Put it on .9 anything and it's fine.)
9. Turn off the ignition and reconnect the IAC electrical connector and plug the spout plug back in.
10. Disconnect the negative battery terminal!!!! Let the car sit for at least 30 minutes.
11. Reconnect the battery.
12. You should still have all electrical accessories off. Start the car and let it run for 2 minutes. You should see the computer make adjustments. Time this with your phone or watch. Don't guess at it.
13. Turn the car off for 2 minutes.
14. Now turn the HVAC blower motor to high. Turn the A/C to Max. Turn the headlights on. Turn the radio on. 70's or 80's stations give the best results!
15. Start the car and let it run for two minutes. Don't guess at the time.
16. Turn the car off.
You should now have the base idle reset done and your car hopefully won't stall every time you stop. It should have better manners across the board.
This should clear up -- when to plug the spout connector back in, when to disconnect the battery, and how long to wait for the computer to make adjustments, and the process of starting the car once with all accessories off then again with all on.
I did this 4 weeks ago and it REALLY helped with the surging (with very little accessories on). I was not able to fully load all the accessories and keep idle. I left it and figured I would try again later. The main difference this time was I disconnected the spout connector (I have never done this step before when setting idle and I was never quite happy with how idle ended up as it would move around a bit).
Fast forward to earlier this week, I removed my IAC and cleaned it by soaking the valve and air ports areas with brake cleaner for about 15 minutes. I drained it, moved the plunger back and forth with a small screw driver to make sure it was freed up and flushed it 2 or 3 times with more brake cleaner.
I reinstalled the IAC, disconnected battery for about 5 minutes and then cold started the car. As it has always done, it started up, revved to 1200 rpm or so (for normal warm up sequence) and then settled to 750-850 range. I then turned on A/C to max, blower fan to max, electric fans on high, headlights, fog lights, rear window defroster, hazard lights. Idle barely fluttered and was steady at 750-850. Something that I was not able to achieve 4 weeks ago. In my case, I believe my IAC was dirty and needed cleaning.
I hope the above helps setting base idle as it did for me.
OK, so here goes the continuing saga of this thing. I did everything in the procedure above, and the idle doesn't seem to drop past 1000 RPM. Now, when I blip the throttle, I have a bit of a backfire, but only when sitting - it doesn't happen under power while driving.