I think daily posting is a good idea. It is, after all, only 3600 words max you have to read, and mostly, you get an idea of whether you like it or not pretty quickly.
Most everyone, I think, visits daily, so it's not like it's out of the way for anyone.
Also, I think that 2 months of voting, involving 3 rounds, is a little excessive, but I can see that this little competition for little stories has grown magnificently!
Something for the suggestion box: Once a month, entries open for a week for flash stories on a topic decided by you or the population at large. Post/Vote/Prize.
That way you don't get inundated for over a month with hundreds of stories, it's a quick round of voting and its decided before the month is out and a new round starts. Everyone is kept on their toes creatively, and you get a metric buttload of flash stories that you can use for podcasts, fillers and/or anthologies.