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OK. The position of the distributor drive gear is a matter of convenience ONLY.
(controversy #1).
Position of #1 plug lead is likewise unimportant (controversy #2).
The only things your distributor needs are (a) all the proper bits properly assembled inside, (b) key on power, (c) proper timing and (d) good condition plug leads (and plugs) connected in the proper order.
The distributor can be made to fit no matter where the drive gear points. Once fitted you just need to do the timing (on the "up" side of the dist. breaker cam!!!) and figure out where #1 will fire and install wires in correct order from there. Done.
I suspect you may have set the timing on the "down" side of the distributor and/or put the plug wires in the correct but reversed order.
About every third time I do it I mess up at first too. Heck, I even tried to make my '95 Dodge run with the wires in reverse order (darn thing did too, but it was a snortin' gutless beast... ran darn smooth when I fixed that little "oopsie").
Oh, if you have to (or, more appropriately, desire to) re-position the cam drive gear note that the oil pump drive will prevent the gear from seating (or engaging the oil pump drive) until you rotate the engie over far enough that the drive tang slips back in. If you pull the gear ever so slightly up so it isn't rubbing on the drive tang for the pump and rotate the engine until the gear is about where it was when you pulled it out, it SHOULD drop in and seat. If not, fear not, just keep rotating in small increments unitl it can be seated.
Mike!
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