Cazzidy:

You need to check the actual length of the chain, not just to see if it is tight (it will be if the tensioner is good, but will still leak down eventually, and it's almost always slack when you start up....). Match the mark on the cam or thrust washer (I'll look it up in the book tonight) and read the degrees ATDC on the crank pulley.

I'd bet you are at 10 or 12, in which case you need a new chain, don't bother with an offset key. This will, incidentally, restore the injection timing, which is also late.

Dollar to a doughnut, you will suddenly have no smoke and much more power! All the fuel that is coming out as smoke right now will become horsepower, and you will have all 65 hp available for driving up hills, etc.!

Peter

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1972 220D ?? miles
1988 300E 200,012
1987 300D Turbo killed 9/25/07, 275,000 miles
1985 Volvo 740 GLE Turobodiesel 218,000
1972 280 SE 4.5 165, 000 - It runs!