How tight should a threaded BB be? I have an english-thread, octalink Shimano bottom bracket, and a new frame. The frame has been faced before painting.

I am not sure the BB is compatible with the frame.

When trying to install the BB, I greased the thread, screwed in the driver-side cup and tightened it. I do not have dynamometric wrench, so I just torqued hard, but not as hard as not to be able to undo it. Then repeated for the non-drive side.

The bearings had became stuck - only with great force could one spin the axis. I loosened both cups about one revolution each, until the axis began moving freely. Now both cups have some threaded surface visible. The cups are not tight at all. 

Are stuck bearings when over-tightening the cups normal? The free cup (non-drive side) looks like it can go all the way inside the frame. Have I set my BB correctly?



UPDATE:
This is my exact BB. I have identified the problem. The non-drive side cup presses against the white seal. The seal is stuck to the axis (which I think it should be), and sandwiching it between the cup and the BB body fixes it's movable flange causes excessive friction.

I am leaving the installation as described above. Will ride it a couple of hundred kilometres and report if any problems occur.
Most components will have an instruction sheet detailing the reccomended torque. This is typically measured in Nm (newton meters). Torque wrenches can also be purchased that show you how much torque you apply. 

Some components even have the reccomended torque value on the component itself.
Checking other components will give you an indication of the difference in required torque in relation to your BB.