Only runs 40 Degrees advanced

I have not seen anywhere in this thread where you've VERIFIED TDC WITH A PISTON STOP. That is the ONLY way to 100% verify TDC. Simple to do, quick to do, little to no cost......and I've not seen it done which would have been my FIRST move. ESPECIALLY after the engine "backfired, ran backwards and never ran again".......your words.

I've seen that happen before, three times. ALL THREE TIMES the timing chain jumped. One was with a Cloyes Billet double roller. "If you don't think" it can happen, you gotta 'nuther thing coming. "All bets are off" unless you 100% VERIFY tdc with a piston stop.