If you have a valve that isn't sealing in #1 the air would come out of #2 because it would have at least 1 valve open.

It won't cost you anything to run the engine for a while, recheck the valve clearances, and then take the compression again.

The fact that compression came back up in both cylinders when you adjusted the valves indicates they did have a problem.

Eliminate 1 problem at a time.

Last edited by Jim Sears; 10/03/2013 9:16 AM.