I don’t remember the exact spec, but 5 psi is the upper end of it. If the pressure were too high it would hold the float down, not up. The gas in the bowl holds the float up to close the needle valve. The fact that pressure holds in the line when the engine is off confirms that the needle valve is staying closed, as it should. However, when the gas evaporates out of the bowl, as it will since it’s a vented container, the float should drop with the fluid level. If it isn’t doing that than you need to investigate what’s causing it to stick.
As for the backfire when letting off the gas... That usually indicates a too lean condition.