timing questions - 1993 GT engine 5spd

[bsedwebt70-5.0]

basically stock - with regular bolt ons - 1.7 roller rockers, cold air, pullies, etc... new everything - tps, act, ect, dizzy, tfi (motorcraft), clean iac, clean egr, new mass air meter, etc... car idles perfect about 800rpm and is smooth etc... but I have been letting the computer re-learn after being disconnected for a few weeks now and my mileage is not what it could be (used to get 27/20 in my other car set up same way now I get 21/16) and I smell a rich exhaust. There are no cats, smog pump, holes plugged, cannister purge bypassed, thermactor bypassed, etc.. no codes in computer... This is a 70 mustang resto mod. I have always felt the car could have more power - it is lighter than the 88 convertible I had by 400lbs and it has no parasitic drag - elec. fan etc.. I set the timing with a light weeks ago at 14 degrees with the spout out and it jumped 10 degrees or so with the spout plugged back in - ran fine and smooth etc... now today I am trying to get better seat of the pants and gas mileage so I bump it by ear and keep bumping and bumping and getting on it - no detonation at all - all it seems to do different is a little bucking when car is lugging (say 40 mph in 5th gear) but no problems - Curious I pulled out the light and it shows 25 degrees at idle 800rpm with spout out and 32 degrees with spout in. What gives? I have heard 18 degrees is possible on some cars but not 25 without detonation with 93 octane 85 degrees farenheit and 90 percent humidity at 800ft elevation. I still have a slightly rich smelling exhaust - no cats - and solid 800rpm idle but have not checked mileage yet - will I hurt anything? Is something wrong? Am I doing something wrong with checking the timing - I am using the far flat edge of the timing pointer nearest the driver side and hooking the timing light to the first plug wire on the plug closest to the radiator on the passenger side. ARGGGGGG>>>>>>>>>>>>>>