Hi,
You said this car was laying up for 15 years but you haven't said how much running of the engine has been done since you got it started or whether it has been driven on the road? When an engine has been unused for a long time, various things can go wrong which may resolve themselves with a bit of use.
There used to be a term used 'Italian Engine Tune-Up', which essentially was a fast drive to 'blow away the cobwebs', this often worked but should be undertaken with caution and only after verifying that the engine is still in good condition i.e. good oil pressure, no coolant leaks etc.
Bear in mind, the car will have been taken out of use for some reason - there may have been some issue e.g. leaking head gasket/low oil pressure etc. and is unlikely to have been prepared for storage e.g. oil/filter/coolant changes, oil down cylinder bores (or 'fogging'/corrosion inhibition oil).
Your initial compression readings were low, your later readings (with some oil down the cyl. bores) were imho quite acceptable and unlikely to be improved much, even with a full engine rebuild. I've a lot of experience on the Fiat twin cam engines and always counsel against unnecessary rebuilds, preferring to try to work with what's there without incurring major work/expense.
Think about this - how much use will this car get in future? will it be a daily driver or only be used occasionally for short runs? If an engine is fully rebuilt/overhauled, it could take maybe 20,000 miles before it has freed up enough to give of it's best.
As an alternative, and only if the existing engine can't be made to run well while still in the car - these engines respond well to an 'engine refresh' i.e. deglaze bores, new piston rings, new crank bearings, lap in the valves and fit new valve stem oil seals but of course, the labor needed will be almost as much as on a full engine rebuild. However, given your engine has covered 64,000 miles, it might need more work, depends on amount of wear present.
My advice at this point in time would be to try to free up any sticking piston rings. Fiat used to use (I'm not sure if this applies to your engine) an unusual one piece oil-control ring which had slots for oil drainage and spaced 1/2 way vertical cuts alternating between top and bottom to give flexibility, this type used to become gummed up quite badly, but if cleaned up, worked just fine again.
I used to turn the crank until all pistons were midway up the cyl. bores and pour a couple of teaspoons of diesel/kerosene down the bores and leave to soak in for a few days, rocking the crank occasionally (this way will result in the oil ideally needing to be changed afterwards). Nowadays there are various more suitable substances to use to free-up gummed piston rings - in the U.S. I've heard of 'Marvel mystery oil' or 'Seafoam' being used, but I've no personal experience of these, so you'd have to search online for info and how best to use.
Obviously the spark plug thread issue needs to be sorted out to allow the spark plug to seal correctly, for reasons of good compression, heat transfer etc. No.4 plug thread is a tricky one to deal with not just because of access but also because it's angled towards the firewall. It's easy to do with the cyl. head off the car but not at all easy in situ. I prefer to utilise an old spark plug with a couple of saw grooves lengthways along the threads to try to clean up the threads - it's a lot gentler than using a thread cutting/restoring tap and easier to turn in the No.4 plug's location. Bear in mind that if the existing No.4 spark plug is only going in 2/3 of the way and is now tight, it may have been cross-threaded/gone in at an incorrect angle.
Should a thread insert be the only remaining solution, you'll probably have to remove the cylinder head because of the poor access. This might actually be a good move as it will allow you to renew the head gasket (at 64,000 mls it might nearing failure anyway), check on bore condition, lap-in the valves (if you wish after checking them for poor sealing e.g. using some kerosene in the combustion chambers with the head upside down - but I doubt there's much wrong with your valves given your compressions readings) and fit new valve stem oil seals (well worth doing any time the cyl. head is off).
Last piece of advice - as you haven't mentioned it - it would be a good idea to renew the timing belt, these engines are interference type, so if the belt breaks, valves will be damaged. Some people delay changing the belt until they have the engine running correctly, then take the car 'just for a short test drive' and the belt lets go
.... Even if you just fit a new belt, it's good insurance - the new belt can be re-used e.g. if you have to remove the cyl. head in the near future. It's straightforward to renew, there's timing marks already present and no special tools are needed.
Hth,
Alan
