Which engine are we dealing with here? Your method of establishing TDC is a bit too random- - - -once you get a puff of compression pressure, then you need to turn the engine until the timing marks align exactly. On the pre-1963 6-cylinder engines, there's a hole in the bellhousing just above the starter with a pointer in it, and a BB-sized ball imbedded into the flywheel. Those need to be aligned, or at least VERY close. The BB is hard to see- - - -most people take the sheet metal cover off the bottom of the bellhousing behind the oil pan, find the BB by cleaning the front surface of the flywheel, and put a dab of white paint on the ball. Then align it with the pointer after you feel compression with your thumb.
On a V-8 or a late-model 6 cylinder, the timing mark will be a machined line on the crankshaft front pulley which aligns with a numbered scale or a sheet metal tab attached to the timing cover. For initial starting, aligning the timing mark with the "0" or "TDC" number is close enough.
Set the point gap with the rubbing block of the point set on the highest point of the distributor cam. .020" is close enough to get the engine running.
Now comes the fun part- - - -with the timing marks aligned on the compression stroke, turn the distributor housing clockwise until the points close, and then turn it back CCW until they just barely open. One good way to establish when the points are open is to use an ice pick type test light with the pigtail lead attached to a good ground, and the ignition switch turned to the "run" position. Touch the pointed probe to the (-) or "distributor" side connector of the coil. With the points closed, the light will not burn. As the distributor is turned CCW, as soon as the points open, the light will come on. Lock the distributor housing down- - - - -the timing is set! Be sure to follow the proper firing order with the spark plug wires: 1-5-3-6-2-4 for a six, or 1-8-4-3-6-5-7-2 for a V-8, both in a clockwise direction. Start with the cap tower the rotor was pointed toward when the timing was set as the #1 spark plug position.
Jerry
