Well, I guess I would pull the head on the CD to inspect the cylinders. Perhaps the rings are stuck, or perhaps the cylinders are rusted. Don’t be afraid to clean up the cylinders with some fine emery cloth, then blow the dust out with compressed air. There is no easy was to have a look at the piston rings/skirts on this engine, it does not have removeable intake bypass covers. Try loosening the exhaust cover screws, remove the cover if the screws will come out without a fight, then you can have a better look at the pistons and rings.
