Hi Spash,
The jets for the Dragonfly carb are: main jet 140, needle jet .107, pilot jet 25, and a 3½ cutaway slide. These were the standard jets for the fuel available in the mid 50's - I have found on unleaded fuel the Dragonfly runs better and picks up cleaner with a 3 cutaway and 150 main jet, then compensate by dropping the needle to the lowest setting. These settings give slightly richer mixture, so may not be suitable for your bike until you have sorted the problem.
The fact that your machine is running rich begs the question "Have you fitted a fibre washer under the fitting that takes the fuel banjo on the top of the float chamber?" This fitting should not have a washer, screwing directly onto the top of the float chamber - fitting one will greatly raise the fuel level.
As your wife is still getting used to the bike, I would expect that she is still only using about half throttle, so the problem probably lies with the slide cutaway or the needle jet/needle assy.
As you say, the air slide should only be used for starting with a cold engine - once the engine is warm, the air slide should be opened fully.
Regards,
Eddie.
