NutmegCT:

When the crankshaft damper TDC mark is aligned with its pointer, is the camshaft hub (and/or thrust washer) notch mark aligned with the cast pointer on the camshaft front bearing stand? If yes, the crank and cam are in the correct phasing. If there is a mark on one side plate of the chain, and a corresponding mark on the cam sprocket, and they are also aligned, then that is simply icing on the cake. The corrective action that is required is to lift the distributor, and reinstall one tooth retarded.

Thanks Frank. When crankshaft damper TDC mark is aligned with pointer, the camshaft hub washer notch is aligned with the front bearing notch. At the same time, the dist. rotor is pointing to the notch in the base, showing it's aligned too.

I hear you on the "lift distributor and reinstall one tooth retarded". But how the heck did this happen? Did turning the engine backwards once while re-setting the point gap cause this? I didn't have the "klunk" and hard to start problem for 6000 miles - then I reset the point gap and the problem started immediately.

Thanks
Tom

NutmegCT:

If the timing chain was very slack when the engine was turned backwards, then there is the possibility that the chain skipped over the intermediate wheel (sprocket) by one tooth, which would lead to the situation of the distributor drive being advanced relative to the crank position. The Service Manuals do not, to the best of my knowledge, specify an initial timing procedure for the intermediate wheel during assembly, hence it may be installed at will, and the distributor will then also be installed to phase the rotor as needed.

From post #12:

<< Only thing I did was to reset the points to 0.018" (4.5mm). >>

0.018" = 0.45mm.
If you really set the points gap to 4.5mm, there is the problem.