Hi there. I've successfully breed 1st badge of jewel fish. There about 100 of them. Now, I'm into the 2nd badge. I did what ur doing by crumbling the food flakes into powder. Sometimes, I feed them with frozen blood worms. Normally, the parents will munch the food and feed their babies. The parents will keep their babies near them. If the babies swim further,sometimes either the male or female will sort of suck them in the mouth and will spit them out near where they want the babies to be at.

If the parents are 1st timer, they tend to have the babies as food. It might take them a few badges before they learn that those are their babies, not food. This advice may come in too late but good luck.