I am finding that the range of fit distance on my saddle post height is less than a cm. Just a hair too short and my knees hurt, a hair too long and my back hurts. Get it just right and both are okay. But it's a teeny tiny "window" that I have to hit. I am wondering if that's just me or others need it exactly on the spot? It's an issue since my bike is a folding bike and the seat post gets dropped to fold and I don't always get it exactly in the same place. You'd think there would be some wiggle room, but apparently not according to my body. Just curious if others have to be spot on or if they have a bit of room where it is okay...

Like everything else in fitting your bike, it probably depends on where everything else is for your particular circumstance. Things such as reach to the handlebars and where the bottom bracket is underneath you to name a few. Possibly changing up the reach might give you more lee-way in seat height if that is an important need to you. And then there is the thing that everyone is different.

I've ridden road bikes and sometimes had and inch or tad more difference than my own bikes for quite a few miles and never felt anything other than I didn't quite like it.

I think the range is at max, ~4mm. I'm talking about the range of most efficient pedaling. That said, I see a lot of folks riding with saddles that must be 1.5" too low. People get used to weird stuff, especially young people, and once they get their neuromuscular system trained to it, it's hard to change.

Yes, others -- like me -- are just like you. Adjusting the saddle -- fore/aft or height -- by just 5mm results in me losing so much power, that it can literally drop my speed IN HALF while going up a 10%+ grade!!! At least in my case, it can also affect cockpit positioning. At my current saddle fore/aft, if my reach is more than 56cm (saddle tip to bar) or the bar is more than 6cm below the saddle -- even by 5-10mm -- my power drops 20%+. If I move the saddle 5mm forward, that power loss occurs if the reach is only 53cm, and bar drop is only 4cm. Go figure!

My body can withstand a small range, but I can definitively feel it when specs are off. Perhaps your body is a little more...capricious

You should build yourself a tool to quickly adjust you seat height after you unfold your bike, like a piece of wood or a ruler?

Is your back hurting because you are bending over slightly more?

I'm actually arched over slightly rather than straight. When the post is that tiny bit longer, the seat moves back
just a bit, and the reach is more. This actually flattens my back angle rather than arching it (my seat can't go back any further
on the Thompson post). I was thinking maybe I need a set back seat post, but that's rather a big production, as it will mean a new
stem and possibly raised bars (cannot make my stem any longer). When I get it just right, there's no problems. It's just that sometimes when I fold it, I lose the perfect setting. I am thinking of getting an engraving pen to mark the post since it doesn't have any. And I was just wondering if other people need their fit dialed in just so perfectly; seems like some do and some don't. Lol.

Good idea. Clearly, that would help you.