Mark G - sounds like you're getting close but if it still backfired then you do need to make sure the carb settings are correct. Good that you changed the condensor but since it sounded as tho it was intermittent I don't think it was that. Before checking the carb adjustments you still need to get the timing right on the Line so you know that is not an issue.
One thing I just thought of, since your engine was just rebuilt, is to make sure the choke fully opens and closes. Your cable could have slipped and maybe your choke is not fully opening so you're running really rich all the time. It can be a little touchy to get it set up correctly. If your choke handle isn't in just the right position when you snap that clip on the choke cable the cable will just slip and won't be positioned correctly. Start with the choke handle in the fully off position and make sure the choke butterfly is fully open/horizontal. Then pull on your choke to see if the butterfly fully closes. If either of these is off you'll have to adjust where the clamp is holding the cable. You'll get some slippage where the S-shaped bend at the end of the cable connects to the lever on the carb.
After you make sure the choke is operating properly then use the service manual to go over the carb adjustments (I think the Operator Manual for a 149 lists them as well). You could put a new plug in since it could be fouled from running rich, but the plugs are always blackened when I pull them even after just a few hours. Your carb setting should be within a 1/2 to 3/4 turn of what the manual lists. If you have to go a couple turns more or less than the manual lists then you may have an internal carb problem or something else completely.
If you have a really old muffler that is failing that can give you a a back firing problem. It could be partially blocking the exhaust, and because Kohlers run rich to begin with you could have fumes in the muffler that cause the backfire especially when you choke it again.
You mentioned the engine has been rebuilt 20-30 hours ago. Have a look around the head gasket to make sure it doesn't look wet and could be blown. If you don't really see anything then I would let it cool for at least 20 minutes and check the torque on the head bolts. If they were not re-torqued after the initial running and cooling after the rebuild then the bolts could just be loose and give you these symptoms (the machine shop told me to do that on the very 1st engine I had rebuilt and I forgot, but my symptoms were what I thought was an oil leak - it was just oil seeping past the head gasket. Re-torqued my headbolts and she was fine after that). If you discover your bolts are really loose, like just finger tight then you'll need to torque them, run for 20 minutes, let it cool 20 minutes, and re-torque them. Make sure you follow the torque sequence shown in the diagram in the Service Manual.
I have to hope you don't have a valve problem showing up since it was just overhauled but if you go over all the other things I mentioned then you'll have to check the valve lifter adjustments (shown in the Service Manual) and if that doesn't resolve it you'll probably have to pull the head and inspect the valves themselves.
I've tried to list everything starting with the simpliest to next more obvious. Keep us informed on here. I'm not the best at the engine stuff, but we got some really good guys that will chime in. (my details get a bit lengthy but I do this somewhat on purpose to help insure people understand).