I use between 5.5 and 8.5 depending on what and where im flying. An example would be, Over PNW 5.5 to 6.5 and over photo real scenery 8.5 :)

The best setting depends on what your pc can handle as using a high lod will chew up gfx memory but at FL350 the textures are not as detailed as if you was flying at 4000ft. This was done to save memory but it has more side effects than good ones imo and one of the things that ruined fsx ( multi lod textures are not always needed if you have a visibility limit but that was not put in to fsx )