Peter, the ZWO driver just adds 4 zeros to the LSB (small number) end of the 12-bit output to make a 16-bit FITS file, so using binary arithmetic, that has the effect of multiplying the true readout by 16.
I find it easier just to work in 16-bit, since this is what the data is recorded in, and to keep all the parameters in the same scale I have to divide the gain by 16 in the target ADU formula.
Take a bias frame, of around 1 second in duration, and measure the median background value. I use a simple tool called FITS Liberator, although you could do this in PixInsight just as well, using the Image->Statistics module. Then change from Normalized (default) to 16-bit integer. That is your BIAS value in the formula.
As an example, with the settings I use my Target ADU comes out around 1000 (16-bit). When I'm shooting a test LIGHT frame, I aim for a sky background ADU of 1000 or around that. Just remember this is 16-bit. Simples.
I think where you're tripping up is you're confusing yourself with the 12-bit thing, which is a bit of a red herring in practice.
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