Re: Valve timing versus distributor timing....
@smahaley, the
valve timing is correct in your video!
Where the Haynes manual is confusing you is that having given instructions on setting the valve timing earlier in the chapter they are now giving instructions on how to time the distributor using No. 1 cylinder as is done on most engines.
However, as I have explained in several previous posts to various members

on the Fiat twin cam engine, when the valve timing has been set (i.e. all the relevant marks correctly aligned), the distributor should be inserted and set so that the rotor arm is pointing to the distributor segment for No.
4 cylinder - i.e. this engine is timed on No. 4 cylinder not the more usual No. 1 cyl. If you check the cam lobe positions/orientations when the valve timing marks are correctly set (as in your video) you'll find the the cam lobes on No. 4 cylinder are pointing away from the valves i.e. both valves are fully closed and the piston is at tdc at the end of it's compression stroke and about to fire.
What Haynes have done instead, is given instructions on how to time the engine to No. 1 cyl. - in order to do the distributor timing this way, it is necessary to turn the crank one complete turn from when the valve timing marks are correctly aligned, this will turn both cams by 1/2 turn, resulting in the cam lobes now pointing away from the valves on No.1 cyl. and then the distributor can be inserted/set so that the rotor arm is pointing at distributor cap segment for No 1 cylinder. This is what paragraph 58 from the Haynes manual you posted is instructing you to do.
Now that I've probably confused you even more, I'll try to give you the simple solution...
Align your valve timing marks (as in your video), insert the distributor so that the rotor arm is pointing at the distributor segment for No. 4 cylinder.
A couple of others tips:-
Don't confuse yourself by turning the crank to the ignition timing position (10* btdc), just insert the distributor with the crank at tdc, then turn the crank backwards to the 10* btdc timing mark and then turn the distributor approx. 5* counter-clockwise (the distributor turns at 1/2 crank speed) so the points are just opening - this should give you near-enough correct ignition timing to start the engine.
As regards inserting the distributor body into the cam housing - as it's gear driven, it can be installed in various positions - I'd suggest marking the distributor body to show where the rotor arm should be pointing when it's positioned at the segment of the distributor cap for No. 4 cylinder (look at the distributor cap for cyl. numbers to find no. 4 and trial fit the distributor cap (a locating peg means it can only be fitted in one position) on the distributor body to determine where to make your mark. Hold the rotor shaft in this position relative to the distributor body as you insert the distributor. You also need to decide how to position the distributor body so that the plug leads are pointing in a suitable direction. The shape of the drive-gear teeth will cause the rotor shaft to rotate slightly as you insert the distributor into the cam housing so you may have to try inserting it a couple of times until you're satisfied - there may be some old 'witness' marks from the clamp on the distributor body to assist you in correctly re-installing the distributor.