Hi Kiwi, if your picture shows how you have timed your engine, I believe the red line should be on the other side of the stator timing mark, before the line as the engine rotates. It appears that your ignition is firing after TDC.
I agree with the timing light method, first find where the spark is happening, and if you have to, mark both your stator and flywheel to suit, if it has an auto retard for starting, time it at zero BTDC and get it running, then with your timing light you will be able to see the advance take place as you rev it.
If it has no advance, time your rotor to the left of the line.
I hope that makes sense, and this is assuming that your photo is how you've timed it.
Tony.