Turning the airplane upside-down to start the engine won't affect the muffler. Fuel should not siphon out.

You want the engine to be turning up to full RPM to get the needles properly adjusted. Since you didn't say what propeller you are using, we can't tell you if it's too large or what. We'd strongly suggest that you prop the engine to turn around 11,000 RPM when at full throttle. Propping it to turn near 12,000 would be very good, but also much louder. We like a 13 x 8 propeller or a 14 x 6 or 7. They'll let the engine turn up, but it won't be a quiet as with the props O.S. likes to use.