You want to balance the plane with the fuel tank empty. With a full tank of fuel when you take off the plane is going to be a bit nose heavy, but this is no big deal. A nose heavy plane is ok to fly with, it's tail heavy you want to avoid. If you balance with the tank full, then when you are flying and the fuel tank is empty, or low, you will now be tail heavy. And tail heavy is a recipe for disaster, so you want to avoid that. Tail heavy planes usually don't last too long before they are re-kitted.

As for the balance, you want the plane to be level when you balance it. A little nose down is ok, but try to shoot for the plane being level. And while you are balancing the plane don't forget to check the lateral balance of the plane. This is to check to see if the plane leans to one side when in the air. The best way to check that (in my opinion at least) is to get some heavy fishing line (twine will work too) and tie one end around the motor in the front of the plane and the other end around the fuselage at the tail of the plane. Now lift the plane up by the line and see if one wingtip drops. If it does then you'll need to get some weight on the opposite wingtip to level out the plane.

Hope this helps

Ken