Thanks Bruce,
the coil (armature) is approx. a business card thickness away from magnet and tightened so it wont move.
There seems to be no gap between valves and the stems (looked in springed bottom part of valves behind muffler). No visible gap anyway. I've turned the flywheel around numerous time to watch the cycle and nothing visible.
I'm still to look at flywheel key as i didnt have the tools to lift flywheel.
I've turned the governer shaft back COUNTERCLOCKWISE and locked it on as suggested by your colleague. Still to kick it over as i'll wait for comment on valves.
cheers
Rob (inahammock)