I think it's normal for any bike to rev like that when you cut off the fuel--as the fuel dries up while there's still engine vacuum it sucks up more air and brings up the idle. that's just what I *think* happens. But either way, I would not bother chasing that issue as it does not imitate normal running conditions anyways. I think what you're looking for is more along the lines of what grcamna2 mentioned which is a rich condition from too much fuel. This could be related to float level or could be obstructed air passages. Based on what you described as the condition you found the carbs in, I would suspect that there is still some kind of blockage in the tiny air feed passages. You can use guitar strings and compressed air to ensure all air passages are cleared--especially the upper ones that are cast into the body of the carbs, which are often overlooked.
Also, I know you tried moving the float level but you don't know what the level really is once you put on the bowls because you can't see it... there is a trick you can do by drilling and tapping the drain plug screws and installing a nipple, then attaching a clear plastic flexible tube to it and holding it upward like a "u" to see where the fuel level truly is. A pain, I know, but if you get desperate it's worth a shot.
Other thoughts--have you eliminated the possibility that you are burning oil and not gas? have you checked your compression? Also, does it smoke that much just at idle or is it through the entire range?
finally, have you tested the shape of your ignition and charging system? Low voltage at the coils can imitate a rich condition.
