Distributor experts....
This image is really from a C2 but it should be the same for your '68. See how the #5 and #7 wires are at opposite ends of the wire holders? This is the reason why

If the insulation value is high enough, you can ty-wrap them together. That's BS


We check compression at #7 and it was 165. My next guess would be the rockers are over-tightened and they are pumping up as the engine rev's. One thing I noticed when changing out the valve covers the rockers were all tight. Not the norm for most cold engines.
I think at this point I can rule the following:
Fuel issues
Ignition issues
Timing issues
Vacuum leaks
Still need to check:
Compression check all cylinders
Pull valve covers and look for rocker issues or a wiped lope.



