Step it up on step II if you can.
If you want a DO residency, you have to do audition rotations at most of the programs. It is rare to get a spot without a rotation.
Go ahead and apply to MD programs that have a reputation for being DO friendly and any other programs you are interested in. A 218 on the USMLE isn't the end of the world. Apply to plenty of programs. Maybe even do some MD audition rotations.
When I was applying I focused on one DO and one MD program, take advantage of the fact that we get 2 chances to match.