Ok, I got the head back on, torqued and have my Top dead Center dial indicator in place. I zeroed the dial at TDC, turned Right to about 3.9mm, went left to 2.9mm and checked my Pulser. Now, my flywheel no longer has a line on it due to past rust and it's painted black now. I marked the center of the slot with an orange marker. Here is a picture of the markings and where the pulser is positioned. To me, this is WAY off and it was running like this! Now I'm afraid to move the pulser and I don't even know if it will move that far! Anyone out there detect if I'm doing something wrong here??

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Couldn't get a engine to pop at all but it doesn't seem that the cheap new petcock I purchased isn't getting fuel to the carburetor. Finally opened the gas cap, put some pressure to it and could see gas coming down...it started right up but soon ran out of gas and quit. Ordered a better quality petcock, hopefully that will fix the problem.

Ok, can you take a picture of the center of the flywheel and make sure the keyway shows up on the crank and flywheel?
Make sure when you take the pic to show entire face of flywheel.

I would expect the crank keyway to be at about 5:30pm w/respect to the center of that alignment window or your coloring in this case.

I would not adjust to anything yet.

What is the number on that flywheel?  Should be FOTO2171.  The nut seems longer than what I expected.  Maybe you used another one.
 

This is a VAPE flywheel and has a smaller diameter, but here is a pic of what I recall is a ~3mm movement on the dial gauge looked like.