Large rpm drop

The power valve is opening way too late.

Can't see enough of the spark plugs to see for sure, but I'm not sure why you are only running 28 total. Something is really wrong.

From the plugs it looks like you have too much initial and total, but that is an Autolite plug so I'm not sure on how the cad comes off.

Also, it's hard to see WOT A/F ratio without seeing down in the shell to see the fuel ring on the bottom of the porcelain.

Power valve was a known good one, ruling out a blown/bad power valve.

I'm running around that timing to keep from detonating on pump gas. I put this setup together last June, blew head gasket early July running ~34* total timing.
IMG_20190707_171756.jpg
After that, milled the heads 0.010" to flatten, kept total timing 30* to play it safe. Initially assembled the engine with the rings on the tight side of kb's spec, butted rings in October and that's when I rebuilt it to how it is now. Detonation may have been a contributing factor to that as well. But idle always been an issue however no matter what iteration of the engine I was on.
IMG_20191102_163355.jpg

Aluminum heads would probably help with detonation and will probably be used down the road if I can find a good deal, but for now closed chambered irons are what I have.

And this is a thread on getting idle adjustment right so let's save WOT for a later date.