1990 Mazda B2200 Engine barely runs when hot, low compressi

I have a 1990 Mazda B2200 truck with a 2.2 L engine. I started losing power a few months ago so I started doing things to figure out the problem. I rebuilt the carburetor which helped a little bit but not much. Over the next few weeks I lost more and more power. At start up, the engine would barely run with the gas pedal floored.

I ended up taking the truck in to make sure the carburetor was adjusted properly, get it timed, and see what was going on. For one, the choke was closed too much so it was choking the engine. The technician fixed this and also discovered that my distributor was improperly seated and bad (oil got inside and shorted things out). He replaced the distributor, cap, and rotor, timed the truck, and adjusted the carburetor and it ran like it was brand new! It was so amazing to drive. Having owned the truck since 1992, I couldn't remember a time it ran better.

About two weeks later, it started having problems idleing smoothly so I took it back in. He made some adjustments to the carburetor and sent me on my way. After a few days I started losing power and running really rough like it was misfiring. Trying to register the vehicle at this same time, it failed emissions miserably. I took it back to the mechanic who did a warranty exchange on the distributor, played with timing and a few other things, but it didn't fix anything. While doing all of this, he noticed that my spark plug wires turned "mushy" when they got warm and shocked him a bit so he replaced them. As soon as he did this he said it ran fine and passed emissions.

Well, I took it home but it still didn't run well. At idle, the engine was shaking a little bit. Revved up, you could feel it missing so it would run and sound bad. I dealt with it until even more power was being lost so I took it back to the mechanic. Unable to figure it out, he finally did a compression test which revealed that compression was down across all of the cylinders. Even while he was testing the compression, the measurements were changing a bit so he used 3 other compression testers which all gave the same results (low compression across all cylinders). He said my compression ratio is 5.5:1 where it should be 8.5:1. The other reading was at 70-75 pounds where it should be 123-150.

At this point, the mechanic wants to pull the head to see what's going on. Sounds like this might be necessary, but this is where things get odd.

When the truck is cold, it will start and run at 60% power due to the low compression. The second I turn the truck off, it won't run again until it's completely cold. For example, I start the truck and drive it all around, constantly keeping the RPMs up and moving. Next, turn off the engine and immediately try to start it. I am able to start it and keep it running as long as I keep the gas pedal floored, but it only gets to 150-200 RPM with the truck shaking like crazy, a little bit of black smoke out the tailpipe along with some liquid (possibly unburned fuel?). The second I let up on the gas pedal, the engine will die. It stays like this until the engine is completely cold again.

Another mechanic suggested that maybe the exhaust flow is restricted. He had me remove the O2 sensor to see if the engine would run when after warming up (where it usually won't run) since the hole would allow the exhaust to escape without restriction. This did not make any difference.

I'm perplexed by two things:

1. How can the engine go from running like it's brand new (smooth, powerful, responsive) to this in a matter of 4-6 weeks? Could I really lose this much compression in that amount of time?

2. From a cold engine, I can start and drive the truck for as long as I want assuming I keep the engine revved up. The second I turn it off, it's dead.

Are these separate issues or related?

More background information in case it helps:
About a year ago, I did a number of things I hoped would keep my truck going for a few more years. I replaced the spark plugs, wires, distributor cap and rotor, ignition coil, O2 sensor, fuel filter, PCV valve, crankcase filter, and air filter. As of today, the carburator has also been rebuild, distributor cap and rotor replaced, and wires replaced again.

The engine was rebuilt 30,000 miles ago (summer 2001).

There is a rear main seal leak which causes me to add 1 quart of oil every 500 miles or so. Sometimes I forget to add oil until I hear the valves clicking. This may have added to some of these problems by allowing the engine to overheat.

Sorry for the long post, but I wanted to get as much detail in here as possible.