Being new at this I find if my left knob is at 9 or 10 position and my right knob around 12 I can hover somewhat
xodarap1 is correct, as I'm running a 3550kv BL motor, 11T pinion, and 1500mAh battery. IIRC, I was running the pretty much the same HOV.PIT and PIT.TRIM settings that you note with the stock brushed motor and 1000mAh battery. You should be OK as long as your main blade pitch is set as per the manual and your stick position is about mid throttle at hover.
if I put the left knob at 12 I seem to get too much pitch and loose my tail authority. My belt is good and tight and the rotor box works really smoothly..ideas?...thanks
Try moving the "tail rotor fixed shaft" (expanded view P/N 116) out on the rotor shaft ~1mm. This will increase the initial tail rotor blade pitch and available positive pitch travel thus increasing tail authority. Just be sure to go over your tail setup by making sure that the tail servo and or tail rotor pitch mechanism is not binding or "running out of travel" during full positive and negative pitch travel. I had to move my tail servo back towards the tail almost 2 mm after doing this.
I like to have my HOV.PIT set at 2:00 and the PIT.TRIM at 12:00 while flying indoors just like xodarap1 says. The good thing is that the K2 will just about fly "hands off" once you find the "sweet spot" as xodarap1 notes.
P.S. Always write everything "down" as far as adjustments, changes, or mods go and try to make only one adjustment, change, or mod at a time. Doing this can save you lots of time and trouble when things don't go well.