Tuning with jets, Power valves and an O2 guage

No you haven't Not with the distributor curve. Ant that's where I think you may could cure the problem. I saw where you said it runs good on 110. What does that prove? That it has too much compression? How do you know? Have you ruled out too much timing yet? NO.

How about THIS:
Running the engine in 2nd gear at 3500 rpms. ALL the timing is in and has been for several hundred rpms. The timing is set to a total of 31 degrees. I floor it and it knocks. Please, please explain how this can be related to the distributor! The timing curve is moot once the maximum degrees are reached, right?
If I ease into the throttle it knocks. If I roll along at any RPM and floor it, it knocks.