As you know, these engines are pretty simple and reliable.
Their also not as critical to run with that small a difference in TDC.
Setting the coil in the middle of the adjustable range should run fine.
Having the points set at .020" the a good flywheel key should be fine.
Pretty un-common is for the flywheel to not be good. I gather there's plenty
of magnetism?
Also, make sure all your grounds for points/ condenser, etc are super clean.
As your probably not seeing spark, try both spinning over the engine with either a
spark tester, or with your hand (your the tester) and with any kill wire disconnected..
Lastly, just because it's new, does not mean it's good....
Plz post back what you find