Some of the older 5.0's called for less gap because they ran a colder plug. If you combine a "normal" plug (spec for 87-93) with the tighter gap you'll get some really hot spark which can cause problems. You can mistake preignition for knocking or detonation and end up pulling timing, etc.
LMR has a post about plug temps and gaps on these cars -- not sure its entirely accurate but off the top of my head it looks pretty darn close if its not.
https://lmr.com/products/79-93-fox-b...plug-gap-specs
Sadly you are running into a situation where the "performance" ignition parts ..... "the good stuff" is not yielding even the performance that IMO you should see from good working OE stock stuff.
Heck -- there are articles out on the web showing a stock 5.0L long block with nothing more than good induction and exhaust paired up with a stock HO cam and 1.7:1 rockers and AFR 165 heads kicking out over 400 HP at the crank. Throw a cam thats making more than 0.475 lift and more than 220 duration and you should be able to easily beat that number.
We've all seen examples of factory ignition parts on these cars being entirely capable of even lighting off a considerable shot of NOS or enough boost to split the blocks. It isn't until needs like a two-step are factored in that I tend to start looking towards an aftermarket ignition part for anything -- maybe that's just me.
I found a copy of a 50 state ignition stickers posted online for an 88 cali car. It said 0.054-0.056. They used the same components as the rest of that period of cars.
Double check your plug temperature ratings and gap together because when you tighten up the gap it runs the plugs hotter and can cause preignition and loss of power. (especially when looking at power adders but that's a topic for another day)
My best advise beyond verifying your timing curve and coil strength -- both steps that are reasonable -- is to make sure you have the right gap for the right temperature of plug.
Personally I've always seen better performance from the 87+ "hotter" plugs with 0.055 gap than the "cold" plugs at 0.045, but I've also seen them not like to start quite as easily when cold outside if you do that on a non-EFI motor. No big deal really IMO.
See what the ignition supplier says about heat range and gap on the plugs because different ignition changes a lot of stuff.
I would run as warm of a plug as I can get away with while avoiding preignition. More gap can yield a better flame front as long as its intense enough to light it off readily. This is true even on factory style ignition setup. Compression does have a big influence on this of course.
I've seen examples where I've let my plugs wear even up to 0.080. The car stilled ran OK, except for an occasional miss at idle. Of course when I swapped out plugs and got them back down to 0.055 the car acted like a completely different car.
Here's hoping you can find some power in here somewhere!
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