Ok got it.. so my question is.. why does the engine idle slow down and die when the lever is up, but when I put the lever down it speeds up?
In the HORIZONTAL position, you are choking off air to give the carbs a richer mixture for easier start-ups. When warm, you will choke out the engine, as you are describing. when your bikes idle slows, its needing MORE AIR, so its telling you to push the choke lever down.
In the DOWN position, the choke butterflies are open. This is where it should be set for normal operation. Allows max air through the carbs.
When your bike is all warmed up, and your choke lever is in the DOWN position, set the idle with the idle screw.
1000-1500. somewhere where it idles smoothly. You really shoudn't need to change this idle screw anymore.
Put the choke lever into the HORIZONTAL position for start-ups....the bike will tell you when it needs this lever pushed down. Mine bike usually needs small incremental changes of the choke over the first minute or two, and then its ready to go..