Is it valve clatter or spark knock you are hearing? By your description, sounds like spark knock to me. Try lowering your timing to 6 BTDC and check it. 305's are the worst engines ever built by GM for this. The 305 combustion chamber was the cause. This is the very reason GM used the ESC distributors with knock sensors in LE9 trucks.
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Mike
1985 Chevy C-10
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