Good question. Mine is heavily modded, so my settings wouldn't be helpful...
http://1uparcade.hypermart.net/projects-kidsball2.htmlUsually with backspin, I think you want to use a lower sensitivity. The problem with kidsball is that the teeth on the encoder wheels are REALLY small, so it makes a good hi-res mouse, but not good for fast game action. That's one reason I modded mine so the teeth are about 3 times as large as they were. I now have no backspin problems.
I think the best option though is to just buy a proper arcade trackball. They were made for heavy play and high speeds, while PC trackballs are made for clicking and dragging, and tend to spin unevenly when cranked too fast. My crayola tends to pull upward when I do fast horizontal spins. I've heard of several people getting Imperial balls for $30 or so. Ebay even has Happ TBs for cheap sometimes.
One thing I've noticed with Centipede in particular, it's pretty much impossible to get the ship to move as fast in Mame as it does in the arcade. Not sure why...