Sounds like you're doing things about right.
The chain slack will decrease as the suspension compresses and the swingarm comes in line with the gearbox sprocket shaft.
I do exactly what you did - check to get the slack about right with suspension fully extended (on centre stand), then sit on the bike and check it's not too tight and adjust if necessary. In a way, it's all about what feels right, you pick it up more easily as you get used to the bike.
Bear in mind the new chain will loosen (stretch) a bit after you've ridden it a couple of times and you'' have to keep readjusting for a few hundred miles. So I wouldn't waste too much time trying to get it perfect now - it will all change as soon as you've ridden it!
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