I have an 89 formula 350 with dual cats.. Rebuilt engine has 12000 mile on it. MSD 6 A ignition was installed in January 2007. Car has unstable idle after engine warmed up and went closed loop since rebuilt engine installed. That was liveable.
Now it wont go past 3000 rpm's without popping and banging.
I checked the TPS and it is in spec. at .55. The insulator on the pigtail for the TPS was broken and was replaced. I replaced the coil(MSD), distributer(Proform),and ignition module.It still had major backfire through the exhaust but at 3500 to 4000 rpm's. I pulled the plugs and they were black on all plugs. The threads on the plugs had oil residue(wet) on them.
What would cause all plugs to foul and leave oil residue?
Under the tail pipes pieces of blackend metal have come out of the muffler. It looks like residue from inside the muffler. Would excessive backpressure(muffler blocked) cause blowback from the exhaust to push oil into the cylinder heads and cause the plugs to foul?
I replaced the plugs, O2 sensor and changed the fuel filter today, but have not restarted the car yet. Timing is at 6btc when last set.
Any suggestions?

 

Has anybody got an idea on what might be going on in this engine?

 

Based on what you said: either the muffler died and cutting it off wont be an issue or the cat died, and it took the muffler with it (spitting out chunks of metal?).

Either way, dump the muffler. Then, the cat. If the engine is puking out metal from the tailpipe, starting it up again is not going to be an issue.

It is already hosed.

And took everything with it.

 

What about the fouling any thoughts on the cause there? I have never seen all plugs bad before at same time.