To insert a stop, just left click on the color block on the Horizontal tool bar before adding the lettering.
Color Reduction cleans up and simplifies an image by reducing the number of colors in an image. You can either allow the program to decide the colors or manually select the colors.
Most importantly, it is absolutely necessary that you use only SINGER® branded needles. Other brands can eventually damage the hook and the machine will require servicing. You can use a 2000 or 2020 for natural or woven fabrics and 2001 or 2045...