Brians ideal has some merit, why not loosen one injector at a time even though recently rebuilt and see if smoking stops. Perhaps a piece of dirt got loose and is in a nozzle. At least you have mentioned the smoke is fuel related by colour. That is good. I would think it would require more fuel at 7 degrees btdc as the burn is weaker or less efficient. For the same power output. I am now going to make a suggestion. Rather than try to work at this and that after a few fairly minor checks. Mark the pump position. Rotate it back to approxamitly where it was. Is smoking gone then? If so talk to a good pump shop. Was wondering earlier why that pump timing was so far off and even had been moved one tooth as well to accomadate it. Could not have happened by itself. Perhaps the altitude compensator or some function of the pump was off already. Keep an open mind as some smoking problems have been very hard to find the source of. I am well aware some of my ideals seem very abstract but on every problem of a mechanical nature I have actually tackled myself in the last fifty years the problem was found and identified. And several where very hard for me as I am not a working mechanic. But I also like challenges to a certain extent.I also personally would like a rational explanation of this if possible. Hope it is something as simple as an injector leaking down though. The sun does shine sometimes. You also did not post how much smoking is going on. A little, moderate or clouds.

Well, I took it all apart and set the timing as per the manual, The timing was off retartded so i got it to the right place about 22-26 DBTC which is fine with me and the results..... Black smoke gone, small puffs of white smoke which is fine
idle is improved vastly, i brought it to the 405 here in LA and went as fast as possible about 80MPH and there was still more left in it(80MPH due to traffic)
Before if i got it to 65MPH i would be lucky and even then it sounded like it was going to explode, acceleration is great and another thing my transmission shifting has improved, hardly notice it changing gears(before it flared),I think this is because on this model 79 the gear change is done through trottle position via the linkage.so it may have been changing gears early thinking the engine was
going faster than it was, Maybe . Anyway thanks for all your help and it has been a good learing curve.
Onto the next project

__________________
1979 300D.

Really happy that all is well. You had me going pretty good when posting just basically setting the pump timing gave you more smoke. Actually my 77 300d is not bad on power either. The only objection I really have is it operates in too high a rev range on the highway but it does get where I am going. Next time you set a pump it will be much easier and quicker.. Think you will get your missing fuel milage back as well. My 77 300d does not seem to do quite as well as the turbo models though. Hope yours does.

I couldnt find IP timing on this site. What am I doing wrong?

I've just found the same thing. Maybe the website is no longer there.

Maybe this will help - http://articles.mbz.org/engine/diesel/injtiming/

Sixto
93 300SD

Of course that's if you don't have an RIV type IP (most 61x engines). For RIV type IPs (60x engines) borrow an A-B timing light set or 'rough' it with a locking tool.

Sixto
93 300SD