Since it is a race car, I wonder if whoever started it cold didn't give it the old high rev warm up routine. It's hard to resist since you want to hear that race motor rev. I've seen many people do it over the years. I always cringe. Hard to see why the noise would appear after sitting for so long.

On your compression numbers - 20/150 = .13. Cylinder #3 is 13% low. It runs better on 4-6, which fits the bad #3 theory.

Your guy says you have spark-how about a timing light instead. Coolant pressure check time for bad HG.

Pulling one spark plug wire should be a VERY noticable difference in idle.

I think olzed is correct.

Heres a video showing a vacuum test with the engine warm. Oil temps were just under 160F and coolant around there as well. Oil pressure is good and EGTs were around 600F which I think is about right for idling. Vacuum gauge read about 17 at idle. Sadly blipping the throttle the gauge drops to 0 and back up to 20+. Optimistically it could just be the mixture is too rich but I don't think it would drop to zero if the rings would good. Maybe someone with a bit more experience can chime in.

Technical Articles: Engine testing with a Vacuum Gauge - at Greg's Engine & Machine

Rest of the video shows the sight windows on the carbs and gain in RPM speed when I open the throttle on each carb individually. It also shows the slides moving and dropping freely so no stuck needles. Finally the video ends with nice clip of blue smoke coming out the exhaust. I'll grab a picture if anyone is interested but near the exhaust tip my garage has a spray of oil. It's not on the video but just before I shut the car off a gruesome metal clanking was coming from the engine which sounds like my co-worker's jeep that has a bad piston pin.

This will be the 2nd bottom end of mine. The first threw a rod. This bottom end has about 23 hours or 600 miles on it. We had a engine builder replace the rings of this engine which the previous owner said was low on compression. Ran this engine with Mobil one 15w50 for the added zinc.

I tried to avoid the revving the engine up until it was warm. After the last bottom end I babied this one.

I have junkyard engine that I think I'm just going to throw in the car and try to run it until it goes. I'll probably replace the gasket and seals before hand.

Thanks for everyone's help I appreciate it. Vacuum tests are awesome btw.

Yeah, that doesn't look good. It may be just me, but I find noises very hard to identify through a youtube video. I'm not sure where the detail is lost, but by the time it goes into your camera and out my crappy little computer speakers, I'm doubtful I'm getting a good representation of what you're hearing.

However... There's no doubt that the blue cloud out the tailpipe is not good news.

Compression test next maybe?

Never give up! Turned out to be the stupid alternator. A friend suggested starting the car with the belt off to ensure it wasn't the water pump. Just by removing the belt and trying to spin the water pump or the alternator I could tell the alternator was messed up. This alternator had 600 miles on and 20 hours.

A clip of the engine with the new alternator and I promise it sounds much louder in person. The smoke we're suspecting may be from the carbs running so rich and the blue tint may be from the camera phone. It doesn't look nearly as blue in person.

I did do a bunch more work before figuring out it was the alternator.

• Retorqued the head bolts (they were a bit loose)
  
• Retarded timing from 44 degrees at 4000 RPM to 36 degrees
  
• Best valve job I've ever done in my life. I used the feeler gauges that were one size smaller and larger then what I was adjusting the valve to get an idea of how loose/tight it was in comparison.
  
• Synced the carbs but they were pretty synced to begin with.
  

Finally a proper compression test. Before I didn't have the throttle wide open nor did I do a dry vs wet comparison. The new numbers. My gauge has marks in 5 psi increments so - is like 3-4 psi and + is like 1-2 psi more then the number.

1 - 180+ 200+

2 - 180- 190+

3 - 160+ 170+

4 - 170- 195

5 - 180- 195

6 - 165 190-

Funny story about the alternator. I asked the guy at Napa when I bought it about the warranty because O'reillys sell alternators with a lifetime warranty. Napa guy says "everything I've bought from O'reilly I've had to take back." They took it back no questions asked and they had never seen one come back like this.