The LCN order doesn't matter for P25. I think the Radio Reference database just does the list in smallest to largest. It's probably fine in slot 4, slot 1 or any slot. Now that I am comfortable with the scanner, I usually program everything myself rather than importing... something to consider. Anyways, I always start with slot one and add to it as they swap the control channel to something new (I do this "as needed" process so I have only what is absolutely needed, rather than loading frequencies they may never use for the control channel). Keep in mind a frequency in the Radio Reference database could be a control channel for some unrelated nearby system -- something I've ran into before. So it's really best to limit the number of frequencies to just what is actually used.
I assume you are doing the programming with the software. It can also be done through the radio on the fly, but this is a little clunky:
"Program Menu" -> "Edit System" -> Select your system -> "Edit Sites" -> Select your site (btw the site number in the scanner doesn't have to match the system site assignment) -> "Frequencies"
On that page, you can add, edit, and delete the frequencies it uses to search for the control channel. After making the change you would:
"Save Changes" -> "Save Changes" -> "Back to system" -> "save changes"
I mention this process in case they change the control channel frequency while you are away from the computer.
If your menus are different than this, make sure you have the latest firmware. I am using the WS1080, but the firmware is virtually identical I believe (when they released the WS1088 there was a big change to the WS1080 firmware).
"None" is probably best for the squelch. I would leave it there. I just said "search" because that is the default. Not really sure of the difference, except on "search" if you are paused on the frequency during or after a call you can hit menu then save the tone that it found.
What antenna are you using? As an experiment, you might swap the two antennas and see how each radio performs.
Also, try different locations. Reception on my favorite P25 system was pretty poor in most places in my apartment, however, when I put the radio on a stand (empty box) 18" above my desk, I get 100% decode and perfect reception on both phase 1 and phase 2. Elsewhere in the apartment it is hit or miss... same on the road. If the WS1088 has marginal performance compared to your other scanner, it could make the difference.
Check out this guide if you haven't already, it's a great help:
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You're welcome. I hope you are able to get it working.