a few things to think about...
The video is confusing to me because your are rotating the crankshaft the wrong way. The flywheel should be rotating clockwise. (as YOU face the flywheel) If you were turning the flywheel clockwise, then your crankshaft timing gear key is possibly sheared.
Your video shows evidence of a badly leaking head gasket. The cylinder wall looks decent, but I would replace the rings/gaskets on that engine.(from evidence of heavy soot build-up, and continued oil pumping above the top ring in the video) The valve lash specification should be INT. valve clearance should be .006", EXH. is .010" cold. I would perform a valve job on that engine, as part of a routine tune-up. The valve train is probably OK, just needs serviced. The video shows the compression release is working. I would expect the EXH. valve/seat is probably leaking.
The coil should be adjusted: 'as close to the flywheel magnets without it touching~~use a paper business card between the magnets & coil'. Then roll the business card out after you have secured the coil. (.010")
A well worn engine like that one, will sometimes give false symptoms of being out of time, like: not spinning fast enough when starting, pulling up on compression and stops turning, or even spitting back thru the carbureator. Water in the gas can act like a timing problem. But most of those symptoms are also directly related to worn rings or leaking valves. (too much oil gets on top of the piston and causes a partial hydraulic lock, which acts like a 'timing problem')
From your picture it looks like the coil is installed correctly and not upside-down, but you didn't mention if it is the electronic ignition or conventional ignition type set-up. If it has points then you can adjust the timing there. If you remove the flywheel nut & bellville washer (replace the washer if it is cracked), and the crankshaft keyway is perfectly aligned with the flywheel keyway then consider the aluminum keyway 'good'. Since you still have the problem after replacing the coil, your original coil is probably 'good' also. If the coil is firing, it is generally considered 'good'. (they either work, or they don't)
The only other thing that could possibly be out of time, is shear/partially shear a crankshaft timing gear key (the crankshaft gear that runs the camshaft, inside the crankcase). I rather doubt that is the problem, and it is difficult to see/determine unless the gear gets way out of time. But just a little out of time there, would cause all kinds of 'timing' troubles. Getting that crankshaft gear to slide off/down the shaft is necessary to inspect that key & keyway.
wwxx
