Clark Miracle: Blue spark at the points isn't necessarily good. What I learned studying the "basics" of breaker point ignition is that the condenser (or capacitor) is there, in part, to "eat" the spark. If the gap is not wide enough to break the current flow in the primary, there is no current induced in the secondary, and hence no spark. Remember, the ignition coil is basically a transformer. A transformer only works when the magnetic field is being built or collapsing, that is, it only works on Alternating Current (AC). In a breaker point ignition system, the points "break" the Direct Current (DC) from the battery simulating AC current in direct proportion to engine speed (RPM). Another side effect of a weak condenser on the ignition system is that the constant arcing at the points causes them to "pit" and eventually lose effectiveness.
So, . . . if the points are arcing when they are wide open, it indicates that current may still be passing to ground (DC) instead of being "broken" by the points and converted to AC. In other words, the secondary circuit is not being allowed to operate, or to operate at a high enough "tension" (voltage) to produce a spark at the coil.
You could try two things:
(1) Verify your point gap at it's widest gap: IH says 0.025" Kohler says 0.035" (if I recall recent discussion correctly)
(2) Replace your condenser preferably with a known good part. The condenser (capacitor) for a Kohler is a different value than that for an automobile engine, but in a pinch, an automotive condenser/capacitor will work for testing purposes until the proper part can be sourced.
If you haven't replaced the push rod for the points, you might want to consider it at this time; it helps keep everything "in range" although obviously, the cam lobe is what determines the distance the points will open.
Finally, if the points are new, you might try rubbing them dry with some paste board or other absorbent material. I've heard that new points can have an oily coating which interferes with operation.
Good luck. I'm sure you can figure it out.
Mike: Looks good. Excellent paint job.
