Not sure how you determined the "preheet system" is working, they can be misleading. Make sure your glow plugs are getting 12 volts. If they are not getting any voltage, check the fuse strap inside the glow plug controller (black box about 4"x4"x2") normally located on the driver's side front fender well. Check your glow plug resistances, with an ohm meter, by removing a six pin rectangular plug under the cover of the glow plug controller. Find a good ground for one ohm meter lead and the other must contact the inside of the female pin connector. If any glow plugs are open or have a high resistance they must be replaced. Each of the 5 female pin connectors has a number indicating which cylinder it is linked to. One is empty.

Another trick is to turn the fuel ratio screw on top of the injection pump upward to increase fuel flow. It may be under a round cap (removable with sidecutting pliers) if sealed from the factory. Loosen the jam nut with a 10mm wrench and turn the screw upward (counterclockwise) a 1/2 turn at a time. Remember how many turns you have made. Usually 2 turns is extreme. My 79 300D was slow to start and way under powered. This made a tremendous difference. The down side is more fuel consumption and possibly more smoke. Don't go to far as this may decrease the life of your engine. Not sure about the legality of this in California.

If neither of these fix your problem, you may want to consider additional diagnosis before doing engine reconditioning.

1. Air filter -> If clogged can limit the air flow
2. Timing -> Crankshaft, camshaft, and injection pump must be timed within specifications. A stretched timing chain or bad tensioner may allow timing to become out of specifications.
3. Injection pump/governor problems-> Rare on Bosch in-line pumps, but possible.
4. Engine mounts -> If bad, may be keeping the throttle linkage from reaching full throttle, affecting power.
5. Turbocharged engines -> Boost pressure line may be plugged coming from intake manifold to injection pump through overboost controller. This limits the fuel flow.
6. Cylinder leakage test -> Where is the leakage? Valves, rings, or head gasket/cracked head or block. Determines what is worn out or damaged before rebuilding a head that may be good.

Good Luck,

JD