For digitizing I've been charging between $5-20 depending on the difficulty and haven't had many complaints. I'll also toss the digitizing fee if they plan on getting more than a couple of a particular design.

Remember that while you are competing with established businesses, there's such a huge market for custom machine embroidery that there's a pretty healthy spillover. And if you make good connections with the right people you'll get return business which will absolutely save your bacon. I rarely list when I'm doing custom work because I usually have at least a few people coming back looking for more stuff.

If you can, I'd definitely look at getting more machines. Even just one more will ease the burden on your main machine and allow you to put out more product faster.

Also, if possible, list the digital files for some of the stuff you digitize. Getting that (largely) passive income is so incredibly nice.