+1 on the toe cages. They scare the crap out of me also and are probably the reason for your toe problems. I prefer any method that lets you step off the pedal with a more natural sideways motion.

By the way, Nike makes cycling shoes so just saying you wear Nike's isn't telling us much.

Usually, you should have the ball of your foot over the spindle of the pedal. However, as you increase your distance, change shoes, pedals, etc., you may adjust this. But if you are wearing shoes with a flexible sole (which you probably are), the ball of your foot should be over the spindle. Definitely, not the arch.