Ben that spark plug only got that way from burning oil. Coupled with the improvement in compression when you did the oil-in-the-plughole trick, it seems clear you are in need of new rings. (It is even possible you will find the rings are broken, and if so you will probably need a new piston.) It is good practice to lap the valves when you replace the rings - it is likely to save you having to do it later, as a separate job. (I notice you have ordered the rings, and intend to lap the valves when you install the new ones.)
Please keep us posted when you do the work, including the clutch re-line. Some pics would be useful for other members, and for the archive.
