One of the primary causes of deformed toes is too much humidity in the bator. I have hatched well over a thousand chicks in a Hovabator 1588 here in the desert of Texas. I do not add any extra water to the bator to increase the humidity. When I first started using a bator, I followed the direction that came with the bator to the letter ( 45% 18 dasy and 60% during lockdown) and killed of $300 worth of hatching eggs and all chicks that did hatch had deformed toes. I switched to dry incubation and I have had 80 to 100% hatch rates ever since and never a single deformed toe.My first chick from my incubator had a gimp claw. Was walking with the toes curled all under. I asked questions and done research and found a way to splint his toes out straight. When i take the splints off to change them, his toes are still crooked but not curled under.Look in emergencies/diseases/injuries and cures for more info. I used a pipe cleaner bent to shape of foot and since i didn't have vetrap on hand i used press n seal. It's like saran wrap but way better. He's wearing his new boot tonight.
Let me explain how this is possible and how dry incubation works. The eggs themselves lose moisture during the whole incubation process. If you have a dozen or more eggs in a bator, the moisture lose of the eggs will keep the humidity up high enough, depending on the size of the bator. I am talking about small bators here, not these huge bators. If you have a small bator, just seal up the vent holes with tape and don't add water. I would only add water if you were trying to hatch just a few eggs. But if you have a dozen or more, I would not worry about it. This is especially true if you live in an area with high humidity.
I will say here that not all eggs are created the same. I have ordered eggs from three different breeds and hatched them all side by side in the same bator, at the same time and had three different hatch results, with eggs from one breeds having a 50% hatch rate and 100% hatch rate from another breed. Different breeds of chickens may require slightly different humidity levels for optimal hatch results, but I have always had decent to excellent results with the method above in my Hovabator 1588. Now some people will say that Maran eggs require extra humidity. I have not found this to be true. I hatched a dozen Maran eggs from one breeder and two dozen eggs from another breeder using the above method and had above 90% hatch rates on both occasions.
I hope this helps.