Gabe. Your having the same problem as all new hobie 16 sailors and all of this is easy fixed.

Jib= Well i cut my batterns down with a hax saw and they were fine. You cut them down so that the cap on them stick out about 2cms extra. You can sew a plastic strip over te battern pocket but not many people do but if you like your sails do it.

Mast rake= I have my mast rake set for my style of sailing and it works great. At the moment i have my main block to block with the sail very tight and all sails are perfectly set. To do this try these;

1. Have bearly any side stay tention
2. Pull the main up first and do that like you would normally.
3. connect your jib and set it up with out tention just at yet
4. Pull the main on till your blocks are 6-10 inchs apart
5. Play with jib tention and side stay tention till you get your sails and wires set hardish. You dont want your boat with so much tention that kills the power in your sail but just enough so if you hope on trap the stays on that side dont bend.
6when set wires pull main sheet on and see what the sails like and just keep playing with bits.

Down haul isn't major either i have a 1986 hobie and she goes great and i dont have the proper gear either but i did put a new pully on just to make it better which i hope you have because a goood pully is the best!!

You dont have to pull the jib up first you can pull it up when ever you want. Teflon cups are used to stop your mast from grinding and you mast might of been made into a weird shape so you might want to check that as well. I hope this helps i know others can help more but have fun and good luck!!