Your setup sounds good with the exception of the foam/peanut, never seen that before so that might be your weak link. As far as cal mag and melted ice as water source you just need to get a meter and check PH and PPM and go from there. I have used distilled water for my seeds and used cal mag once the little leaves start yellowing a little bit. And like he said, get the PH down on distilled water. Good luck