I found this useful advice when I was searching for help last night on setting sleeves in flat:
To install [flat] shirt sleeves that do not require easing in, begin by
aligning one end of the sleeve cap with one end of the armscye, right
sides together, sleeve on the bottom. (The sleeve will touch the feed
dogs, the body will touch the presser foot.) USE NO PINS. Begin sewing.
Sew slowly. As you sew, make sure the sleeve turns so that the machine
goes around the curve with a uniform seam allowance. Bend the armscye
backwards as you sew to make it align with the sleeve cap. Remember, you
don’t have to make a lot of it align: just make a little bit align,
right in front of the presser foot. Align an inch, sew an inch, repeat.
Soon the sleeve will be installed and you’ll have a beatiful smooth
To install [flat] shirt sleeves that *do* require easing in, follow the above
procedure, except before starting, center the sleeve cap in the armscye
and put in *one* pin to keep the sleeve cap centered in the armscye. As
you sew around the curve, gently stretch the armscye – AND NOT THE
SLEEVE CAP – as you sew. Keep a constant gentle pull on the armscye.
Make sure to remove the pin when it’s about two inches (6cm) from the
presset-foot so the pin won’t cause any distortion in the seam. The pin
may be used as a reference of how you’re doing – if the lengths of the
pieces are matching better as you near the pin, you’re doing well. If
the armscye is still too short for the part of the sleeve leading up to
the pin, you need to stretch harder. If the armscye has become longer
than the sleeve cap, you’re stretching too hard.
From Thomas Farrell in a 1999 alt.sewing post (I love the intarweb)