1.8 is preferred for sure. but the marks are okay, thats how the factory set it. i strongly recommend a dial gauge and scribing new marks a lot of the marks are accurate, some are not. dial gauge is about 110 bucks though, so....
my hot rod one has a full blown cdi/programmable timing curve, etc. but, thats like 1k in ignition parts.
you have to set it with a light, no choice.and the rev limiter on mine is set at 11,600. so, i dial gauge it, scribe marks at a few points of the curve and check it at various rpm's.
also, there is a good cost effective igntion, basically a modified dyna-s being sold by nick pastore out of new jersey. Vintage Smoke. works fantastic.
http://www.vintagesmoke.com/The old standby pirrahna/autocar/newtronics is basically crap these days, so dont bother.
theres LOTS of info on the rd's out there. lots of things have changed w/the internet allowing recers/pro builders to swap ideas. w/out the networking id never have gotten mine done the way i have.
and yes, this started as an aircooled 74 RD350.
putting down around 70 at the rear wheel. and no, thats not a tz or a banshee topend.