First, be sure you are satisfied with your dough and remember that it needs to rest for about 1/2 hour before you begin cranking it. The Italian rule is one "egg" of pasta dough at a time---that's a real measurement. Work it in your hands flatten it and then you'll need to put it through the widest setting about eight times. Each time you put a piece through give it a one quarter turn, but always in the same direction. After 8 cranks through the widest setting, one each at the lower ones except for the last unless you are making lasagne. Repeat with each "egg"

The holes appear because the gluten isn't developed enough and you're not getting nice elastic sheets. As healthierkitchen says, running the dough through on the widest setting will knead the dough, making it smoother and more elastic, so that you can roll it out.
You should also knead the dough when you make it (either by hand or in the processor, however you mixed the dough) and then leave the dough, covered with a towel, at room temperature for half an hour before starting with the machine. This gives the flour time to hydrate and absorb the water in the eggs, which helps to develop the gluten as well.
It's kind of hard to make it too tough unless you use a machine for the dough and use it for quite a long time. You need quite a bit of 'toughness' for the dough to withstand the rolling out.

I forgot to say, but you're probably already doing this - after going through the widest setting and folding enough times that your dough feels somewhat elastic, then go through each smaller setting one time each.

I have one of those hand cranks too. Definitely go through the widest setting several more times, at least. That step gets the gluten going. After it comes through the machine at the widest setting the first time, fold the long piece into itself in thirds. Then run it through at that setting again and and repeat. Over and over. I am guessing 5 to ten times, but you should feel the dough getting a little more elastic. I hope the folding description makes sense! good luck.

I've never made pasta with a machine, but when I make it by hand, I have to be careful to keep from rolling air into the dough. That's what will cause the bubbles. Are you possibly kneading it in a way that adds air to the dough before you run it through the machine?

regular old unbleached flour.

What kind of flour are you using?

It's a very simple hand crack machine. I'm not sure of the brand, but it was very inexpensive. I'm using the widest setting first, but only running it through 2-3 times... Will more help?

what kind of machine? Are you running it through on the widest setting first for maybe 5 or ten times, folding in between, before moving to the smaller settings?