Here is the simplest way to set the points, provided they are TEC or Hitachi brand (if they are Daiichi brand then it is harder to do):
1. Set the 1-4 points to 0.014"/0.35mm gap when the crankshaft is 90 degrees (1/4 turn) past the 1-4 "T" mark. Note: use the kickstarter or the electric starter to bump to this position: do not use the large nut by the points unless you first remove all sparkplugs, as it can bend the shaft if the plugs are in.
2. Turn the engine 1/2 turn from there and set the 2-3 points to the same gap.
3. If you have a strobe timing light: run the engine at idle speed and check the timing for the 1-4 side first: slightly loosen the 3 baseplate screws to turn the entire plate for this adjustment. If you only have a static light, connect a battery charger to the bike's battery first, turn on the ignition and connect the light across the points: then turn the engine slowly over in the Clockwise direction ONLY with the big nut and adjust the baseplate until the light comes on at the "F" mark for 1-4 cylinders. Tighten the 3 screws back down.
4. Now repeat step 3 but for the 2-3 set of points, using the small subplate to adjust the position of the points.
If the timing comes ON too soon (too advanced) you can reduce the gap to as small as 0.012"/0.30mm to retard the timing.
If the timing is too slow (comes ON too late past the "F" marks) you can open the gap up to as much as 0.016"/0.40mm.
If the points are DAIICHI brand (which have a tiny 3-leaf-clover emblem stamped on them), then they will likely not time up correctly. The lower ground arm on Daiich points must be bent closer to the moving point portion in order to time up, in most cases. Also, Daiich condensors are known for their failures, and new ones fail in less than 100 miles, typically. The TEC points plate assembly from Honda is made by TEC and works far better.
The CB550 does not make enough electrical power to run a Dyna S or Charlie's Place solid-state electronic ignition unless you also reduce the headlight power (like with an LED headlight bulb) and use higher-resistance coils, like the Dyna 5-ohm variety. Even then, the battery must be in top condition and the bike ridden at mostly high RPM hiway speeds, or the battery will always be very low. If you use points, as Honda intended, it will fare far better. I also make a Transistor Ignition that was designed expressly for this bike because of its low-power situation, and after you get the points working properly and set, and the condensors working, you can install this as a plug-in device that will stop the points from wearing after that.