TFOX has it right, the rest should normally be up as long as possible and not contact the fletchings. On many fall aways this means that the rest should be reaching the full up position in the last 1 to 2" of your draw cycle. Setting the distance more than this normally leads to the fletchings getting to the rest before it is fully out of the way.

Giving a plug to my all time favorite drop away, the Limb Driver ensures this is the case as it is actually pulled out of the way by the limbs rather than relying on spring tension and cord timing to get the drop time set.