I'm over in the US visiting and have a 1976 XL175, all the electrics have been removed so is running off the alternator/magneto. I can start it, with difficulty, it will idle just, but unable to increase revs, the carb is clean, points are new and set, ign timing ok, need to get another spark plug and try that.
I'm a little puzzled by the ign wiring, the wht/blk wire from magneto goes to the coil possibly through the ign switch, along its length the points wire is spliced into it, the condenser is also connected at the coil seems to be only one LT wire on coil. To run the ign switch has to be in the off position and when turned on the engine cuts, surely like this when the points are closed the magneto output is directly to ground and shorted, could this have damaged it?