Dont worry about the mm of thread showing on your shock body set up your sag to these instructions for both front and rear.
These are a good base line and it has been a good start point for me on my bikes GSXR1000, YZF 1000, Husqvarna SM610 and SD.
First follow what is shown in the diagram for sag its a good read so read all of it don't skim.
Best if you get a mate that can read a ruler and lift a bike.
Then start playing with your rebound and compression.
Start at the KTM recommended settings that suit you from the manual.
Remember the spring supports the load and the dampening controls the spring on rebound and controls both the spring and load on compression.
If the preload is increased to get the sag correct reduce compression and increase the rebound.
If the preload is reduced to get the sag correct reduce the rebound and increase the compression .
Small adjustments to the clickers with warmed up suspension, tyre pressures set and test ride the same peice of road.
Good luck it is worth the time to set it up.
Ronnie Q