IT band issues from biking

I'm going through pretty much the same problems. Unfortunately, there is no single answer. According to what I understand from discussions with my physical therapist, there can be 2 muscular reasons: a specific part of the quad (don't remember the exact name) that is weak, usually not the case with cyclists, and weak medial glutes. That can be corrected by specific exercises that your PT can give you. There is also the pedalling style, if your knees hug the top tube very tightly, that put more strain on the IT band. Until recently, I was not wearing my orthodics in the bike shoes, since I started using them, things are getting better. WRT to your position on the bike, my guess would be that a higher seat put more strain on the IT band, but that's just my guess.

I hope that this little bit helps... your PT could certainly help much, MUCH MORE for you than any forum though.

I would look more at your cleat position rather than seat. Tiny adjustments in cleats can make a big difference in knee angle.