All right, near the finish line finally!
It was an air leak at the vacuum port screw holes, but ironically it was on a different intake port than I thought. Originally I noticed that the #2 cylinder vacuum port hole was enlarged to m6, so I figured this had to be where the leak was. So I removed all 4 intake screws, cleaned up the area and holes, applied some permatex no1 to all sealing surfaces and reinstalled screws with new aluminum washers. I let it sit for 24 hours to cure. The next day I took her for a spin and the problem seemed gone at first... but it just took longer to come back. After a solid 30 minute ride, the problem was back to itself and I was defeated.
When I got back to the garage I noticed some dark brown goop bubbling from the #4 screw hole. When turning out the screw, I got about half the threads out and the screw just pulled right out of the hole. The hole was completely stripped and the screw had just barely enough bite to go in, but there were no threads to seal any air.
I had some nice stainless m6 screws lying around so I decided to drill and tap all 4 vacuum port holes and install new screws, aluminum washers and some permatex no1 for extra good measure. All 4 drilled and tapped with out a problem (#2 was already m6, so I just cleaned the existing threads with the tap). Again put everything back together and went for a test ride the next day.
This time the problem was fixed!!! That was it, problem solved, but there was still some hesitation and relatively flat spot around the 1/8 throttle. Very very similar behavior to the air leak, but not as unmanageable. More RPMs fixed this new symptom, so going back through the thread I wanted to re-evaluate all previous suggestions since the problem was still similar. Ultimately, I think it's still running rich. I turned the air screws all out from 7/8 to 2 full turns out and the problem is nearly gone.
I might try 2.5-3 out and see where it feels best, or move the needle from 3rd to 4th clip position. At this point I'm just experimenting to find the right mix for that 1/8 throttle flat spot.