Normal differential setting is around 10 degrees. It's the amount past the setting that the control has to "play with" without it or set to 0 the unit will short cycle. Your problem is not the temperature settings or the differental, it's the tankless coil which is probably starting to plug up. Tankless coils are nororiously inefficent and possibly the least cost effective way to make hot water. Disconnect it and install an indirect. Which is the most efficient way to make hot water.