Your rudders should stay up when you put them up so you may need some new Rudder Cam parts or need adjust your rudder system. Also the older H16's tend to have some play in the rudder system and when parts get worn they tend to have even more play and may need some new parts for stiffening purposes. Putting on new one piece gudgeons and getting a rudder stiffening kit helps a lot. Also putting on new H20 style tiller connectors and adjuster kit would also be nice to stiffen the system up. Put all this can be costly so adjusting the rudder system and maybe replacing a few worn parts should be all that is necessary.
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<br>Yes you need the Teflon mast bearing as it helps the mast to rotate more easily and with the bearings in you are not wearing the aluminum out in your step area. Just good maintenance practices.
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<br>tightness of the shrouds is based on how much you rake the mast and sail performance issues. I just make sure that my rigging is tight (not overly tight) and that I am getting proper sail shape. Also you will need to add another shroud adjuster (the long piece of metal with many wholes in it - "front stay second from the top" as you stated) on the forestay connection point so you can rake your mast back all the way for heavy heavy air sailing.
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<br>Hope this helps. Also buy the book the Hobie 16 performance manual for $19.00 at http://www.sail-s.com/main/cart-s/h16TRAPSEAT/trapse.htm which will give you all the tips on how to adjust rudders, rake, etc. The book is not mentioned on the site but is available there or you can check else where.<br><br>