I am not sure either. I know when I was putting the engine at top dead center on the compression stroke, I had all the spark plugs out and just a paper towell in the number 1 spark plug hole. I was turning the engine over by hand and once there was compression the paper towell would pop out. I then rotated the the crank until indention on the the balencer lined up with 0 on the timing tab. When the compression started, If I remember right the mark was either at the 11 or 12 o clock postion or right near that area. Then I put the distributor in and lined up the rotor to where the number 1 spark plug was going to be connected to the cap. I don't know if how the cam was degreed has anything to do with this or not. I think I am going to call the machinist who built the engine and see what is going on and how the engine can run with the timing at 2 degrees after tdc.