RE: My new YS110 is not happy, breakin, setup?
In my experience, about 99.9% of the time when an engine backfires, it's because it's running lean. I've never seen an engine that was rich backfire. So, I'd recommend that you start by ricening everything, including the regulator, and see if the problem goes away, or at least gets better. After that, take your time making very small adjustments to the settings until you get it running right.
David