Dummy question, but did you go through all the ring gaps/ ring lands etc ?? Did you file the first and second rings to size ? What does the wrist pin look like?? I think your lack of compression is from rings more than anything by the sound of it. We’re you drawing 65-100psi on a hot engine or cool ??
Several thoughts -
1. Another issue possibility is the BBK MAF. (It should not be speed density as a California car, right?)
I did not believe the C&L fans when I got back into mustangs and should have. I got THREE BBK MAF meters that tested bad in a short time. @jrichker has posted how to test them. The C&L meter body and a new Delphi sensor insert from Rock Auto (even though as a certified counterman/former Stealership parts manager, I am insulted by the rock auto ads and that there is no be live to call now). It runs smother than with the stock meter and with more power than the BBK. I have to wonder why the used one was for sale. If you have a multimeter, it would be an easy check.
2. Except for the cats , the anti pollution stuff is shut off at full throttle, and removing the misc. stuff only saves about 8-12 lbs. I weighed before I put mine back on. It was not worth pulling if you plan on anything but strip use. And not having it just greatly irritates the computer without a reprogramming. Reprogramming is expensive and hard to get done here, and your car would not otherwise need it at this power level.
3. It sounds like you may be costing yourself more by trying to do things too cheaply. For example, doing the block without the heads is asking for trouble. (One of the main magazines dropped a valve because they were rocking in the guides!) What else is not done right or done incompletely that is causing or covering other troubles? My car was in some factory appearing class before I rescued it. Chasing down the non full throttle glitches and codes took time, but it now runs great. AND I know more than the “mustang exert” mechanic at the Ford Stealership. Read, attempt to comprehend, and print out everything jrichker has written up! Then listen to and follow the advice of the old timers here. That is all it will take for you to also be the local expert.
Good luck, and post us the codes once you have gotten the anti pollution stuff back on and put the fuel pressure back to stock levels (without the vac line attached. The “Expert” tried setting my pressure with the line attached, and the timing with the plug in. I do not know how his 5.0 got him to work.)