I can't look at the schematic just yet, I'm still at school so I apologize.
So anyway, yes, inductors are used very often for filtering. It doesn't need to be very high inductance; Maybe like 15-20 uH, on just a ferrite rod or a toroid. It gets rid of the higher frequency ripple. Higher capacitance doesn't always fix everything
Also, you might want to try perhaps a forward converter design. It's how most PSU supplies work (except for nicer ones...they use a half bridge inside)
The only problem with forward converters is that they require a transformer. BUT, this allows you to use rectified mains!
SEPIC converters allow for boosting and bucking, depending on which needs to be done. (the voltage is always constant, regardless of the input voltage) The only problem is the amount of components required to get it working. And, since you'd only be stepping down voltage, a SEPIC converter really doesn't make sense. There'd be no need to ever step up the voltage.
To help with the "large resistance" values for the feedback (or, shunt resistor) you just need some sort of error amplifier, just an op amp. It basically multiplies the voltage a certain amount so that 30 mV becomes 3 volts, or whatever you need. That way you can use much much much smaller resistance values. Then to adjust it, you just use a potentiometer to change it.
A buck converter would probably be the best way to go, or forward converter if you can afford to add a transformer to the board. Either way, the feedback methods are still roughly the same. Or if you wanna get really fancy, a resonant converter.
If you want, I can shoot you a PM and give you my email address so we can talk a little quicker than on the forums.
EDIT;
I just looked at the schematic... I can't tell how you've got it hooked up. xD
May I try and see if I can find something else that may work a little better?