B&S 21 HP Running Rough

Have a Craftsman mower with a B&S 21hp single cylinder with numbers 331877-2371-G5-110408ZD. Lately it has started surging with the governor seeming to control it. It will not idle except with the choke half closed and even at full throttle needs some choke. All its passages seem clear, but I haven't removed the Welch plug yet. Is there something behind there I need to worry about? When running at full speed it is laboring and I can hear some misfires, all this while I'm holding the governor to prevent the surging. I rebuilt the Nikki carb last summer and have disassembled it several times this spring looking for the problem, but I'm admitting defeat and asking for help. Changed the rubber gasket from carb elbow to block, but no evidence of any leak or damage. Have also flushed out the fuel tank, running it on non-ethanol gas, and changed the fuel filter. I have adjusted the valve lash. I'm going in the morning to get a spark plug since the old one is nearing a year old. A compression test looked a little strange, seemed to not climb every compression stroke, then climbing another 15 to 20# on the next stroke. It averaged around 160 to 170. I tried a leak-down test with my cheap Harbor Freight tester that is only designed for 15# pressure, but I'm not sure I trust my results so I'm skipping that. I'm frustrated and out of ideas and hunting some more ideas. Oh, haven't adjusted the governor yet as I didn't want to create another problem if I can't get it to run with no choke.

Thanks,
Dave

B&S 21 HP Running Rough