It depends on your hookah. If you have a $3o from the mall, you're never going to get the perfect smoke.
If you have a respectable hookah, 1 inch of water over the stem is good. 2 coals will do it unless you're smoking a large clay bowl or a phunnel.
Shisha should be packed loose, but to the top of the bowl.
Pictures of your normal setup would help a lot.