I recommended 256-384 before Moonshell improved the playback speed of DPG, since that was the only bitrate range that could reliably get you the recommended FPS at the time.
As of Moonshell 1.6, you can use 384-512 and use a higher FPS as well. 20 FPS for 256x192, 24 for everything else (could probably get away with 25 for PAL).
You should update your guide for 1.3: VeryHigh was renamed to Ultra, 32768Hz audio was added (and is infinitely superior to 32000 and 48000), KVCD option was removed (forced on now), regular stereo removed (replaced with JS). I also recommend using 2 passes.
Oh, and AdaptiveDelayControl set to 0 is actually a good thing. It doesn't make things worse at all, and in fact gets rid of skips, period. The only thing that happens is if Moonshell can't keep up, the video lags behind the audio until it can catch up, but it always goes back into sync pretty quickly. It's much more pleasant than 2 or 3 seconds of no video at all.
The dithering option works properly now (but it's still not what we consider dithering) and works to reduce skipping by playing the video in half-res. But it sucks, I just use Dithering=0, GOPSkip=0, and AdaptiveDelayControl=0. Works best.