60 psi is low. On mine, the slow speed needle was best at 5/8. Yours may vary. Bad primer seals show up as slopping gas out of the primer plunger when you press it to prime. Yeah my Gale wedge-head would run circles around my TN. But my TN only had 60psi also. Did I mention that is low?
EDIT: Not sure, but it looks like your Slow/Start/Fast lever may be bent. Also, are you sure the points are set correctly? I noticed it slows down when you give it full throttle, which might be due to too much spark advance (points opening too far/soon)
