Wrong distributor for 69 318?

Example I posted for someone last year.
Brown lines are the specs from the Dodge Shop manual.
Gray are examples of actual measurements someone made on the car.
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Red indicates the two timing measurements from post 1.
upload_2022-4-1_15-9-9.png

IF the distributor has an advance curve similar to a factory '69 318, then timing between 700 rpm and 3000 would look something like this. And that's going to be a problem when used with vac advance. This is illustrates the problem @PRH was posing about advancing the initial as you did.
upload_2022-4-1_15-14-18.png

Once you measure and plot the timing between 700 and say 2400 rpm, then you'll have enough info to decide what needs to be done.

Depending on the cam and compression, the engine's combustion efficiencies may have changed so maybe the long secondary advance of the 2 bbl 318 is no longer necessary. In which case, look at presmog 273 4 bbl as a timing guide. That's what we did with Ricks70Duster here.

Remember more timing is neccessary at idle for hot rods because the burn is somewhat cold and getting contaminated with exhaust from the valve overlap. The 318 2bbl was pretty efficient burner at idle. Even without CAP, a 318 would be happy at 5* BTC.