The M1 shouldn't leave a hole. Are you knitting into the little loop in the back or the wider strand in the front?
When I have to increase in a ribbing or seed stitch pattern, I do it like this:
If the stitch that will be added at the beginning is a purl, I'll purl and knit into the first stitch.
If the stitch that will be added at the end is a purl, I'll knit and purl into the last stitch.
I do the opposite if the added stitch will be a knit.