Thanks for the help. Confirmed solid, not hydraulic. Set all valves to .025 cold, and since its an iron block and heads, that shouldnt change much, maybe just tighten up slightly as it heats up. Seems to run fine on the hose still.

Now working on timing. Found out my old Accel dual points distributor was locked out at 36 degrees, nice. Going to replace points with Pertronix conversion kit, then recheck timing to 36 degrees. Should be good to go after that so another water test is next!

Bonzai!
Got the same issue goin on my boat, was just curious how your results turned out after the .025 clearance? Exact same setup iron heads and block, unknown cam, confirmed solid lifter. Been battling this for weeks, any help would be appreciated!