When entering your income in the foreign earned income section - enter the full amount of your income, even though it exceeds the amount of the allowable exclusion. This will cause the software to automatically populate the excess amount to the form that calculates the credit for you.
Don't forget to include the amount that you pay for your housing as well in the foreign housing allowance section. This goes on the screen "Enter [Your name's] House Expense." Expenses allowed here include rent, repairs, utilities (except phone), parking fees, insurance, taxes, security deposits, and rentals of furnishings (but not purchases) if any of these apply to you.
This can allow you to exclude a little bit more, but typically only works for taxpayers who rent. Those who own their property overseas generally don't benefit from this provision.
In the foreign tax credit section, it sounds like you navigated through the toughest parts very well.
You will want to select both for the 2555 question, and then enter no additional income (assuming that you enter the full amount of your income in the foreign earned income and exclusion section). This allows TurboTax to automatically carry the excess for you. You can then leave the question about other income blank (no need to even enter 0.)
Including the income for you both allows the ratio of total income to foreign income to properly calculate which gives you the higher credit that is appropriate in your case. When you do not include your wife's excluded income, it apportions less of your foreign tax to you in the form of a credit. This is why you see the numbers change fairly dramatically when you don't make that selection.
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