Atomic Z2 reg is free flowing with new Seacure mouthpiece.

[inquis]

fully open is the knob turned away from myself correct?

Yes, "top of the knob turned away from you while in your mouth" is "open".

The manual and the research I’ve done says to not leave the knob all the way open while diving that is only for rough seas, jumping into surf that kind of thing. I’m unsure why that is.

That's backwards. Fully clockwise (looking at the end of the knob, i.e., "closed" or "screwed in") is the hardest to start the flow, useful for entry and on the backup regulator. In normal operation, open it to make the start of breathing easier, but not to the point it free-flows while in your mouth. Over time as internal parts wear, you may need to adjust it a little in/more closed to stop a slight free-flow that might have developed (slight bubbling, really).

I don’t really notice a change in my breathing from all the way open to all the way closed.

It controls only the starting effort. Once the flow starts, there is no difference.