Wieckster:120 degrees is what the oil is when it goes into the machine.
This will lead to poor conversion in colder (or even mild) temperatures. Lower process temps mean longer processing times. Longer processing times lead to cooling of the mix, therefore requiring even longer processing times, and so on... Obviously, this varies by location.
Wieckster:The fuel and distilled water test it all seperates
I very much hope this isn't the quality test Fuelmeister recommended to you. The results only indicate if you have residual soap in your fuel. They will not indicate whether you have water in your fuel or the level of conversion.
Wieckster:fuel is clear
I've seen clear fuel that has enough residual water in it to make it off-spec. This test is useful, but not a clear indicator of quality.
Wieckster:burns well
Testing fuel quality in an engine is not the smartest idea. A "failure" result could be quite expensive. Even vegetable oil and motor oil will burn well in a diesel - for a while.
Try a pHLip test or the knockoff for more clear results on fuel conversion; the 3/27 solubility test is also useful. Also, there are quantitative water testers you purchase to determine the water content of your fuel. At a minimum, you should perform and pass these tests before you can claim to be making quality homebrew.