I have a 71 250C - SOHC M130 engine which is different than the one in the 280C. However, some things seem the same. I replaced my Zenith carbs with Webbers and upgraded the ignition system and still had some of the problems you describe. My timing spec was also 4 after. I set it to 12 degrees BEFORE and now the car runs as I would expect it to. My research indicates that the late (retarded) timing was MB's early attempt at emissions control, along with some other 2 and 3 way valves, etc. Anyhow, I doubt you distributor is off a tooth - I think you have what I had - just a factor retarted timing setting.
Another issue. Yes, JAM Engineering (Monterey, CA) has a Holly conversion for your engine. I have talked with John at JAM a few years ago - nice person. At one time he gave a 25% discount to MBCA Members. Check out their web page at www.jameng.com
- lots of neat stuff along with prices, etc.
Hope this helps.
Dan Taylor/ Tulsa, OK MBCA '71 250C/'81 300TD-T