As high as you can get it without crossing the peak and falling....ie. it doesn't matter if it's 1100 or 1400, so long as it doesn't rise, then dip back down due to detonation....you want it to keep climbing until the end of the straight, then cool off-throttle for the corner, then repeat... See Al Nunley's posts on the matter from some time ago...
Really depends on how tight the motor is setup. After break in is done I would say if you ran 1250* on gas it would be close, and safe. Once you are familiar with it, tune it closer to that line. Not sure on alky KT's? I would guess 1000* on alky would be also safe. I would also recommend a consistant fuel/oil mix. Never know whats coming out of the local station pump? Buy a top rated race fuel for it, it will maybe save you someday? Oh, and I mount my probes as close to the flange as possible.
does can / pipe / expansion chamber have an effect on EGT?
With 75-80 degree air temps and Spec WKA pipe (SR-Y) we only see low 1100's. I'm afraid to go any leaner because I'm already at the lean end of where the builder told me to be on the carb and I'm afraid to stick a piston looking for every last little bit.
The real advantage of EGT, it is "real time". Its whats going on now, not 30-45 seconds ago like head temp. Also ambient air temp doesn't affect the reading. The ambient air does affect the mixture or tune though. The Mychron numbers are so small they are hard for me to read underway. When I used a Digatron I could tune the needle and watch the temp change as I turned it. In the photo tuning and watching the gauge.