Yeah... maybe I should just buy it from you
It would be tough, but I would learn to live with it.
Your Accel ignition is a good one, but its by no means ready to run out of the box. The advertised advance curve is rarely correct. Some experimentation with a Sun ignition tester would do wonders. You'll probably want 34-36 degrees total and you want as much as possible at idle to help smooth it out. I might suggest (until you get your combo settled in) running manifold vacuum to the vac advance canister. That will be all wrong for MPGs, but it will help you get the advance you need at idle and less at high loads. Figure out the actual advance the mechanical offers, then set it so it provides a total of 34-36. If your mechanical offers 20 crank degrees, set the initial to 14 degrees at idle. Sounds like a lot, but then you can adjust it within an acceptable range.
6mpg with that combo in a truck and an untuned ignition curve is pretty impressive. I would have expected 3 or 4. I only get 14 from my mild 454 in a car with an ignition curve that took brazing, shimming, and tuning for 8 hours.
The plugs your running are great. They run cool which will help prevent detonation. Smart choice.
I still suggest getting that compression down with different heads. Until then we will just be covering up for the proper state of tune. The cam you're using is very hefty but well tuned for that compression. The two together really require much more than pump gas. You can burn pump gas in it, but the ignition curve you have to use (as you've discovered) will have to be so slow that power will suffer big time. Your 500-horse 350 is probably only making 300 hp since we're covering up the problem superficially. If you run the proper gas or drop the compression, you could have a 450-hp 350 that will run on the street gas at the pump.