It just doesn't sound like a head gasket. I doubt that a compression check would tell you much. I would strongly suspect ignition if you have eliminated the shooter in the carb. Check for burned points, a bad condenser or you could have a broken spring in your centrifugal advance. Coils usually get worse with heat, but one can't take anything for granted.
I did check the top end if the distributor looks good (points, button, etc.) but I do need to verify the centrifugal advance is working. It would be hard to narrow the problem down to a coil problem without just flat out replacing it. The resistance on the coil is fine, so if there is another coil problem, it's not obvious.
Thanks for the suggestions.
