Didn't waste any time. Practice swapping the motor with those mounts. If they're not just right, it will be a pain in the butt to pull and install a motor.
I'd definitely Tig that. Put a junk shaft in it. Squeeze it. Burn as much of it in as you can with out getting in to the shaft. Pull the shaft, burn it in in side. Ream it back to size. Done.
Call Dave at Noss Machine. Know your deck height. Quick google search will show ya a few ways to get it real quick. You can't just use shelf domes unless the jugs are on a spacer plate. Even then, a set of domes from a plethora of reputable guys will/should out perform regular pro design domes.
Lots of builders in the sponsor section on the homepage who have done builds with CPI's. You can also peek in the dyno section for some actual data on what can/has been done.
As the motor was ported that will in a sense lower the compression if there was any exhaust work. Reason being, by raising/widening the exhaust more volume is able to escape.
160lbs is actually pretty sweet. It is enough compression to take advantage of race fuel without being to harsh on engine internals.
Do you know what the squish is like with the base gasket change? That can also lower compression.
That jetting should be a tad richer IMO. However, a dead cylinder is another issue. Thoroughly check over carbs, and start checking simple electrical stuff. Roached plugs, plug caps, pick up gap, coil ground is clean, wire harness condition, etc.
All the engine dynos I've personally seen, (only about 4-5) are all tucked in to corners collecting dust. In turn, those are all people who have chassis dynos and they choose to flog those instead. Personally, if a bike comes in just needing a few tweaks, you have to take it all apart and assemble it on the stand, test, then out it all back together in the frame. Just not interested in paying less to work more.