Setting the pickup gap is a critical adjustment. Using this video you can also check the gap anytime as well. I also recommend lapping the flywheel to the crankshaft to get the tapers to match.
You can use a drill and lapping compound that is normally used to lap valves (avail at auto parts stores).
After you have the flywheel lapped it will most likely have less run out which will allow you to slightly decrease the gap between the flywheel and the sensor.
You may be able to get down to .5MM but anything between .6 and 1mm will improve performance.
Again, make sure the flywheel is running very true before attempting this or damage to your sensor could result. If you are not confident with your abilities then follow the instructions in the video.