1986 740 - B230F

I just cleaned the IAC valve and now the car stalls more frequently on startup (every time). The idle also drops when the AC is on. I checked the operation of the IAC valve when removed from the car and it opens and closes easily with 12V applied to the terminals. I did notice that it was stuck half-open before I cleaned it. When the car is warm, it runs fine.

I have also recently:
replaced the entire distributor with hall sensor
replaced the fuel pressure regulator
cleaned the throttle body

These three things improved the way the car runs. When I cleaned the throttle body, I checked and adjusted the idle switch. It seems to work correctly (I tested for continuity with my voltmeter), and I hear the 'click' when I pull on the throttle cable.

How should the IAC valve work? Should it be either fully open or compeletly closed by the computer, or does the computer vary the amount that it is open. I also tested the connector for the IAC, it is getting 12V on the middle pin and ground from one of the side pins when the car is running. I can't feel it open or close, no matter what I do to the car (ie turn on AC or pull on throttle cable). I disconnected the hose connected to the IAC from the side near the air filter and there is strong vacuum through the IAC - does this mean that the valve is already open?

If you made it through this, can you give me any advice?

Thanks in advance,
Steve