Sisie,
You know more about equipment than you give yourself credit for. Maybe not the details but you're tackling jobs a lot of people would just pay the pool people to do. Anyhow, the 6-way valve should be easy to eliminate. You have 3 ports. Input, Return, Waste. If you have the INPUT and RETURN (output) ports hooked up backwards then the WASTE and BACKWASH settings would not work. Flow would be blocked. WASTE is a thru path past the sand and BACKWASH feeds the INPUT to the WASTE port thru the sand backwards, that is from the bottom to top of the sand bed. In both cases the RETURN or OUTPUT port is isolated and blocked. Pressure would be very high and no flow anywhere. As for the level of the sand I comment from common sense and that says fill it as high as possible and still maintain maximum exposed surface area at the top. Fill to the point just below where the tank diameter starts reducing. Also, a little sand in the sight glass is normal. You lose a little each time you backwash so don't sweat that.
Since the flow almost stops after a few minutes of vacuuming it sounds like you're picking up a bunch of crud and plugging the filter. What kind of pressure change do you get from start of vacuuming to the point where the flow stops?
See where you stand after this and we'll go from there. This stuff isn't rocket science so I'm sure we'll solve the problem.
Al
Edit: It would help to know specifically the make/model of the filter and valve.
Edit-2: Carl did mention the possibility that the valve was assembled incorrectly. Definite possibility. Probably 6 bolts holding the thing together and there may not be any key for proper orientation of the two halves. Everything I said above will identify that problem too.
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