Its been a while since I posted keep that in mind in case I repeat what I have already posted.
The distance between my burner and keggle is around 2 3/8". The closest I can get my burners to the bottom of the keggle is 2". When I added the SS bolts to the base of the keggle, the distance increased to 2 3/8". Others have tested distances and they posted better boil times with the distance of 2". That is without a shroud but I think it still applies.
Make sure the gap between the pot and shroud is no more than 1/2" (slightly less is OK)and consistent all the way around the pot.
You definitely need to insulate the outside, I use a cheap fiberglass welding blanket loosely wrapped round the shroud. Even during hot weather there is a noticeable difference in how vigorous the boil is after removing the blanket.
My keggle is lifted by the SS bolts so that the shroud actually sits on my brew rig capturing all of the hot gasses.
With a shroud the boil can be more vigorous so I always have to lower the heat once the wort comes to a boil. It also boils from the sides more than the from the middle so be careful. Here is a quick video of a 10 gallon batch boiling.