Great write up
You will need the appropiate test tracks. I prefer "My Disc" from Autosound 2000 if that's still available and the ISACA disc. The ISACA disc has mapped out tracks (ie singer is here, piano here, sax is here), to assist with imaging. You need a sine sweep track, correlated (mono) pink noise in 1/3rd octaves, full spectrum coorelated pink noise and a phase check track or tracks (one voice and three voices). I assume you could find those on the internet. An SPL meter helps, but your ear will suffice. I also use a pen and paper to jot down notes as I'm tuning, which can really help if you get interrupted and is practically a necessity for steps 4 and 5.
1) Level matching and setting the phase of the midbass drivers: Turn off sub and disconnect tweeters. Match the output level of the midbass drivers to each other using a pink noise track and the gain controls on the amp. Once the midbass drivers are level matched, use the phase check track to get the phase relationship of the midbass drivers. Reverse phase of one of the midbass drivers if necessary.
2) Setting midbass HP point: Play a well recorded track with a lot of detail in the bass (ie heavy metal and rap usually won't well). I prefer something "acoustic" in nature - Nora Jones for example. Set HP at a high frequency (~150hz) and crank the system to max (unclipped) volume. Keep trying lower HP pionts until you hit one where the driver breaks up, distorts, the bass loses detail, etc. Set your HP one click above where distortion kicks in, probably around 100hz with the CLs.
3) Level matching and the setting the phase of the tweeters: Disconnect midbass drivers and connect tweeters. Once again use a pink noise track to match the output levels of the tweeters. Don't mess with the balance control or amp gains, use the crossover's attenuation circuit. You can also adjust the tweeter's output by adjusting the tweeter a little on/off axis. Now play the phase check tracks again, reverse phase of one of the tweeters if necessary. Sometimes the phase check track doesn't help here, so you might try music that has a good center image or a pink noise track or AM (mono) radio. You want a tight focused center image.
4) Setting the level and phase between the tweeters and the midbass: In this step don't change the phase of the midbass drivers and don't mess with the amp's gains. If you change the phase of the tweeters remember that you change both tweeters not just one side. Set the balance to one side and match the tweeter's output to the midbass driver's output using the attenuation circuit on the crossover.
Repeat for the other side and then repeat the level setting process (don't mess with phase) from step 3 to ensure the tweeters are still level matched to each other. You're somewhat limited by the passive crossover, so get it as good as possible.
Now center the balance control. I use the phase check tracks and try both polarities on the tweeters to see which produces the best imaging.
5) There is a possiblity that you have cancellation around the tweeter HP frequencies. In other words what may work best for imaging may not work best for frequency response. Generally FR trumps imaging and we still have time alignment to play with.
Here's where taking notes helps - ie we don't trade horrible imaging for slightly better FR, when we could have great imaging and only a slight FR problems. Plus now you may undo what you did in steps in 3 & 4 and we want to be able to get back to where we were at the end of step 4.
Set the balance to the far right. Play the sine sweep and pink noise tracks to see if you have cancellation (a dip in response) centered around the tweeter's HP frequency. If there's a dip, then try reversing phase of the tweeter and see if that helps. If it doesn't help go back to the way it was. Repeat steps for the left side.
Now center your balance control and see if it sounds better now (better frequency response) vs how it sounded at the end of step 4. Go with whichever sounds better to you. If it's a "tie" then stick with what you have at the end of step 5 and we'll see what time alignment does for us.
6) Setting the level, phase and crossover point of the sub: I like using an SPL meter and pink noise tracks here, but you can use your ear too. Use the gain and subwoofer controls to match the sub's output level to the midbass driver's output level. Don't be surprised if your sub is set 3-6+ dbs too high.
Now that the levels are matched, we work on phase. Play a track with detailed bass lines (again I suggest avoiding rap, hip hop, heavy metal, pop, etc). Try the sub in both phases and see which way sounds more detailed and accurate.
Now we've got the level and phase set and it's time to play with the crossover point. Choosing the same crossover point as your midbass driver won't necessarily sound the best, espeically if you listen with exaggerated subbass output. Often times leaving a gap works better because the subbass to midbass transistion will be smoother; ie HP the midbass at 100hz and LP the subs at 70hz and let the sub's output roll off into the midbass.
Now that everything is dialed in, you can crank the subwoofer output a little if you like exaggerated subbass.
At this point your system should be sounding pretty good and now you have the foundation to take advantage of the features the 880 offers.
7) Equalizing. Use the sine sweep to identify if you have any noticable dips or peaks in response. Then use the 1/3rd octave pink noise tracks to identify what specific frequencies need to be dealt with. With an EQ you always to cut first and only boost if absolutely necessary. Don't boost beyond 3-4db; remember +3db = double the power. Excessive boosting leads to clipping and could damage a driver.
Remember when equalizing you're not necessarily going for flat frequency response. What's important is smooth frequency response. For example, your system won't sound crappy if there is an increase of 6db from 500hz to 5000hz as long as it's a relatively smooth increase. OTOH if 5000hz is 6db higher than 3500hz, then your system will sound like crap. You want to smooth out the dips and peaks, it's not necessary to eliminate them. Sometimes flat sounds like crap.
Time alignment should be the last step.