Run-on, Dieseling Help

[70GMC396]

Not a mechanic so bear with me - trying to get the my father-in-laws 70 396 up and running. Hadn't been turned over for 3 years. Drained all the gas and put in 87. Had "fresh" fluids, but 3 years old. Got it going after priming several times and ran perfectly, not a single hickup - knock on wood. Then it happened...

just kept running on. WOULD NOT STOP ON ITS OWN.

So did usual dropping it in D. The interesting thing was that I tried to cut all fuel and air and it would still go on...minutes at a time before finally backing out the exhuast and occasional hiss up through carb. That was the last time I'll ever hold a towel on the throttle plate. Didn't look like the plate was being held open either. Found leaks on both exhaust manifolds. Could that be enough? It does burn some oil until the engine expands - normal I guess for an old BB? Should I be concerned about valves/guides? Could it be all the California crap allowing air to get in as well? Doesn't have EGR, but does have everything else - 3 systems at least. I checked for leaks, but everything looked OK.

Water temp dead on normal - not even hot on the guage after 30 minutes on and off trying to find problem. Went to the middle and stayed there.

It had a complete tune up by his regular good mechanic 500 miles and 3 years ago. New condesor, points, plugs, timing, etc.

Apparently, it has always done this, but only intermittantly.

My check list will include:
Higher octane.
Lucas fuel additive to hopefully get some deposits out - better product suggestions (Marvel/STP just old wives tales?)
New plugs - maybe colder
Double check timing
Check idle
Vacuum leaks
Remove emissions crap if possible (special distributor setup?)
Check points/condenser/cap, usual stuff

Where would you guys start if exhaust and timing don't fix it?
Thanks!