Just bought a '63 1/2 ton from a friend. He put in a new LM1 350 crate motor and I have two problems. It is set up with a '69 Z-28 intake and Holley 600. The engine only has 3K miles on it. I just got the timing set up correctly and put the vacum advance line to the correct port on carb. It runs 10 times better now. Here is the problems I still have. When running at cruising speeds 45 to 50 mph. the engine lunges and jerks irratically and intermittenly. When engine is pulling up a hill at this speed it runs smooth though. When I accellerate hard it runs fine as well. I changed the carb to a new Edelbrock 600 but exact same problem. The next problem that scares me is I noticed after running the engine and getting it hot I noticed exhaust smoke (blue) at idle and more from the right side than the left. What could cause this?

Any help appreciated,
Mike