Just a couple of things;
Sounds like you were in the HIGHEST gear possible on the small ring (small ring/small cog) - meaning that you were "cross-chaining", which you should not do (too severe an angle for the chain to bend and will wear your rings/cassette prematurely, not to mention the noise).
The other thing about the shoe - just get your shoe/pedal so it's at the bottom or top of the stroke so the turning of your shoe isn't obstructed by anything. The shoe can't turn indefinitely as the holes
do end, you'll just have to turn the shoe until you reach the end of the hole/cleat travel and clip it out.
As for the hot spots, you may want to wait until your cleat position is actually fixed to determine whether there's actually any problem. If your cleat was moving that much, you don't actually have a read yet on how riding feels in the realistic range of movement given a fixed cleat position.
Have a great time and good luck.
