Yes you are correct on the compression.

Going to try and post a pic, hope its clear enough. Pic robbed from the internet.




The part in green is a possibility of what could be going on. You wont be able to see this if you pull the valve cover, but I MIGHT be able to describe how to look for the rocker movement as you turn the motor over(pull rope, not the starter) The ball circled in red is part of the compression release that "Lifts" the exhaust rocker very briefly, allowing compression release and easier cranking. You won't have to tear yours down this far to do what I'd like to have you look at. Valve cover only has to come off motor for what I want to do.

 

Ok so I've got the valve cover off (couple bolts were missing!!) Attached a pic, so I'm hoping you can talk me through it!

 

If the bolts you are missing were in the valve cover, pretty common situation. Not a big deal. If you think there are bolts missing on the rocker arm shaft blocks, youre fine. Nothing in the pic is missing. Threaded holes circled in green don't have anything that needs to go there.

I'll try to convey what I'd like you to do. Look at the cam from the side(like directly inline with the rocker shaft. Pull the motor over with the pull rope. Watch the exhaust rocker and obviously you will see when the lobe opens the valves. Well that ball in the cam for the release, opens the rocker also. The thing is it only opens it a tiny bit(the tiny amount of opening allows a brief release of compression pressure and makes the unit turn over easier) Just watch the arm and see if it opens for the lobe, and then see if the rocker arm just opens a small amount shortly. If you see it just slightly rise, it is attempting to work.

Looking at the pic now, you could also just pull the 4 10mm head bolts(red) and remove the rockers off as a complete assembly and visually inspect it. You wont hurt anything. They do have dowells holding them on, so they may be a little stiff coming off but should be pretty easy for you. Just pay attention to how they come off and reinstall in the same locations when your done. Leave the bolt(with blue on it) alone, it just holds the rocker shaft in the block. The other rocker block will slide off as it isnt held on with anything. Once it comes off the rockers can slide off to. They dont have to come off the shaft to check for wear on the rocker. While your at it, might as well check valve clearance. .006 on intakes, and exhausts.

Im guessing this unit had a valve cover gasket. If it tore and you dont want to wait for a new gasket to show up, use sealer on it like they did in the later models. It wont hurt anything.

 

Ok so I got the valve cover off and did what you exolained, I couldn't really see the bit that only supposed to move a tiny bit...the intake and exhaust valves are going up and down when I pull the cord...which bit is supposed to be moving a tiny bit??
heres a pic of the underside

Checked the valve gaps and the intake was about 0.002, so I've opened them up to 0.006, assuming I've done it correctly. I turned the engine over with the pull cord untill it was at TDC of the compression stroke. Which I believe is whenn timing marks are parallel to rocker cover gasket surface, are the yellow marks on the next pic the timing marks? Also that's as close to parallel as I could get them when pulling the cord! Thanks again!

 

It's hard to see much on my phone. When I get to a PC, I'll write more. I think I see a possible issue, but want a better look.

the exhaust rocker arm is the one that will slightly move to release compression. There is a lever in the end of the cam, it forces the ball in the rocker arm to protrude higher than the cam surface, briefly opening the exhaust rocker. Once the motor starts, centrifugal force rotates the lever in the cam and the ball no longer has pressure against it and ceases to briefly lift the exhaust rocker.

Your exhaust rocker shows some wear, where the ball makes contact. If it's too much wear, the lift from the ball decreases, and makes the motor hard to pull over.

 

I'm trying to upload a photo with my phone, but not having any luck. Sorry. Will do it on a PC when I get a chance. And then it works! Go figure, tried 6 times!!! The circled area is where the ball rides. If that's to worn, no more compression release.

 

So the small bit of movement you're referring to to release compression should be on the exhaust side, what's the sequence; intake, exhaust then compression release?

 

I've never really thought about the order of the lobes and release I guess. Here is the order I see from looking at the pic. I think I'm right, but not positive on this. And as always, pic is robbed from the net.

 

So the order I see is relase, exhaust, intake.

 

Ok so I carefully watched the rockers whilst pulling the cord, and couldn't see any movement on compression release, I think it moved once in like 10 cycles! It seems to be clicking too, is this the ball bearing sinking into the cam??
I felt the groove thats been created on the exhaust rocker and it feels pretty pronounced, and I'm guessing as it's not moving when turning over it's too deep, therefore not allowing compression release? Is there anything I can do about this or will I just have to replace the exhaust rocker with a new one??
Also, are you able to confirm that I've done my valve adjustments correctly? Thanks