Well for starters welcome to DBA.
So when you say that the motor sounds like its cutting out on the bottom end does it clean up about mid throttle? If so you may be a little fat on the bottom end. So I would pick up a couple of pilot jets smaller. Say like a 43 or a 42.5 and a 42. That should clean up that cutting in and out. Now if it were starting out with quick power and quickly falling of its face your too lean.
Now on to your spark plug and pre mix ratio. Do you have a manual? If you dont, get one. Not a Haynes or a Chilton, A factory manual that will come with the bike if you were to have purchased it new. It will tell you what type of spark plug you should be running, and what oil pre mix ratio you should be running. Along with a bunch of important other stuff.
As for you spooge issue. Its a fact of life with 2 stroke bikes. My bike is jetted perfectly right now for my elevation and the expected day time temps. Yet it still makes spooge. Not very much but it makes it. Bear in mind that it really doesnt hurt anything but it does make a mess. Unless your way too rich and then you risk fouling plugs. The reason you get spooge is caused by a few thing, a rich condition and or the engine it not operating at its full temperature. By not operating at its full temperature when the combustion cycle happens it doesnt consume all of the fuel oil mixture. Well that fuel oil mixture that is left in the cylinder gets pushed out on the exhaust stroke and makes its way out to your silencer tip. But before it does that it gets absorbed in your silencer packing reducing performance, increasing the decible level of you exhaust note. Neither of those things are good. What do you do to cure this. You can lean your jetting, experiment with your jet needle setting, and adjust your air screw, to get the bike operating the way its supposed to. Remember when I talked about operating temperature? Well your bike, along with mine and pretty much every other 2 stroke dirt bike that was designed for racing (KEY WORD RACING) are designed to be operated like your racing it. Wide open throttle. Well I dont know about you but Im too damn old to be riding at wide open throttle all the time. So I am very particular about my jetting. Finding that sweet spot will take you a little time and a little money in assorted jets to get it figured out. You asked if there is a particular jetting set up with what you have. Yes there is but you have to find it. Because your set up will be different than mine. 2 stroke bikes are very particular about how well they run and perform based off of your current jetting and the out side temperature and elevation. So you could get your bike jetted perfectly in the morning (50 degrees) and by mid day (85 degrees) its not running like crap but isnt as good as it was in the morning. Elevation is a big time factor too. ALL BIKES that are sold new (unless you specify other wise) are jetted for sea level. Typically sea level is 0 feet above the ocean to about 1500 maybe 2000 ft above sea level. If you live with in that range your bike should run great on the stock jetting at say 60-70 degrees. If it gets warmer than that you may have to rejet a little bit. Ok Ive covered what to do with your jetting.
This is what you should not do with your jetting. Increase or decrease your pre mix ratio to get the bike to run right. Yamaha engineers spent alot of time designing that bike to make it run at peak performance all the time. They have figured out exactly how much oil is required to be mixed with a gallon of gas to provide the right amount of lubrication for you piston and cylinder. I cannot say for sure exactly what your bike requires for a pre mix ratio, because I dont know. However I can be fairly certain that based on the age and displacement of your bike (same as mine) that your Pre Mix ratio should be 32:1. If you run a leaner oil mix your gonna hurt your engine. If you run a richer mix your just wasting oil.
So let me reiterate briefly
Yes the pilot jet controls, the low end of your throttle control. Yes there is a magic jetting solution. Unfortunately all bikes, riding condition, rider style, and envronment are gonna be different. So your going to have to figure it out on your own by trial and error. (side note) once you get carb sorted out and the bike running and your start to get your jetting dialed in. Make sure that the bike is up to temperature, and have some extra plugs. Speaking of plugs. There really arent any magic spark plugs either. Find out what Yamaha says is supposed to be in your bike and run with that. You can also do some searching for alternate plugs. However................. your engine will run best when properly jetted with the spark plug that Yamaha recommends. Oh and dont be afraid of a little spooge. Now if its dripping off your exhaust and making a mess on your garage floor. Be afraid. Also. How fresh is the top end? A worn out top end will cause poor starting and a rich condition. A worn out cylinder with a fresh top end will do the same thing. So like I said its a lot of trail and error.
Im not the smartest 2 stroke mechanic, and I dont know everything. Some of the stuff I put in this I learned from real 2 stroke mechanics, some of it I read in forums like this, some of it I learned by trial and error, and personal experience. If I didnt believe any of what I posted here to be true or factual information I would not have posted it. If you have any more problems let us know. There are lots more guys in here that are smarter than I about alot of things 2 stroke.
), however here are some How-To's another member wrote that might help you out. 
