the gaggia normally sits around the 90ºC mark in "brew" mode (ie, when the steam switch is off). when you flick the steam switch on, the heater element will come on (the element light goes out), the temperature rises and the steam builds. once the machine reaches around 160ºC the steam thermostat cuts power to the element and the boiler cools to around 120ºC before it will kick in again.
basically, the best way to use the gaggia's steam system is to open the wand a few seconds before the element cuts out at 160°C. the little gaggia boiler can maintain a good deal of steam pressure for long enough to stretch a decent volume of milk so long as the boiler stays on for the duration. without a temperature gauge or pid ( both of which are a worthy upgrade imho) you're flying a bit blind, but i would suggest that you time how long the machine takes to get from brew-idle temperature to full steam temperature after you've flicked the steam switch. opening the steam wand at 2/3s to 3/4s of that time should give you a good point at which you can produce good steam for an indefinite period of time.
the other thing to keep in mind is that after steaming, the boiler seems to run a bit "dry" so if you have just stretched some milk and left the steam switch on and the machine is cycling from 120 to 160 then next batch of steam will be poor and unusable. to overcome this, i suggest you run the pump as the steam is cooling to help to re-fill the boiler (for lack of a better description).
great little machines for the dollar, they just need a bit of playing with to get the best of them. if you haven't already, research the OPV mod, the silvia steam wand mod and look into a pid.