Your input settings look pretty normal, but those are some pretty extreme amp gain settings. You should not need to turn the input trim and gain that low with single coils. Do you have anything in front of the Amp that might be boosting the level? Also, with the gain control that low, the bright cap is bypassing a lot of treble and the tone will be very thin, especially with single coils. With my Strat, the 59 Bassman model is quite clean at about 3 on the gain and setting input trim to 0.5. That said, many early Fenders do not have a whole lot of clean headroom and will typically start to break up fairly low on the volume control depending on your pickups. If you want a more modern, compressed, super clean tone, go for a later Fender model, like the Double Verb SF (Silverface Twin Reverb) or a master volume amp like the USA clean (Boogie Mark IV clean channel). Both have higher wattage, larger transformers, and a lot more clean headroom.
Also, what are you using to monitor? Maybe the Axe is clipping the input of your power amp or monitors and causing the unwanted distortion.
