Sorry I can’t help too much with the bits. I know subtle differences in bit geometry make a huge cutting difference. I highly suggest you get a proper 1/8″ endmill, at least one that you can compare things to. That bit you have show looks more like a rotozip bit and seems very long. Like a drywall bit, it will cut foam no problem but not sure what other materials would work very well with it.
As for surfacing your spoil board. How far off is yours? I have never needed to do that. The tolerances I expect have never required me to prep the surface before the cut. If you are milling PCB’s you would want to just surface mill your jig, no need for the whole bed. I can’t really think of any other reason to surface the whole bed unless it is really far out of whack. Maybe I just get lucky using thick mdf it always seems to be really flat.