Installing a distributor one tooth (or more) off, won't keep it from producing a spark.... it'll just be at the wrong time or wrong terminal. I'd use a ballast if it were me. In the start position, the ballast is bypassed, which is fine for a few seconds it normally takes to start the engine, but it's hard on the coil, points, and related wiring to use it continuously. I don't think adding a ballast will cure your current, no-spark problem, but it was just something you should do if you plan to run the engine any length of time.... like the initial cam break-in period.
