If you look back at the thread Klark Kent sent you to, I believe I have gotten everything in order.
Do you know for sure your tach is spot on? I don't believe mine is. I have my tach set at '1400rpms' and the pressure shows 5-6psi. Oh my other, smoothly running 750, after it has warmed up (it shows 1200rpms and 5psi) I can back off the throttle screw and drop it past 1000rpms, and the light will flicker, the come on, and when I get down to 800rpms, it pretty much dies..
If you got the tappets in order try and get it sync'ed and see if that helps.
Have any more questions let me know, i've went through that whole dang bike and I think I just about have it whipped!
Good luck with it!
JAG