Listen to this noise...

The contacts inside the cap are worn because the rotor is hitting them. The rotor has about an 1/8 of an inch of vertical play and about 3-4 degrees axial. From all your comments I believe this to be the problem. Now what would be causing the rotor to have so much play and what would be the remedy? You guys are awesome!
So how does one miss part interference?
If that is the case.

The rotor will move from the mechanical advance gives some stationary