With no other changes you should be running timing close to stock. If you want better idle, then yes you can bump up initial a little but a lot of stuff is interelated so I'll leave it there. With EGR especially may have to back off the vacuum advance a little to avoid part throttle ping.
Don't see anything to be gained by running a 160 F thermostat. Get oil and coolant up around 190 - 200 F as soon as possible. That gets the oil viscosity in the design range and will burn off moisture.
edit: I'll add it should help the getting the cylinder temperatures up sooner as well. Once the fuel droplets are in the chamber and the valves are closed, within reason, more heat during the compression will help vaporization and make a better burn.