Well, it seems the problem is definitely involving the polution control system. Although I need to get a gauge to check my vacuum, It would seem as though the idle issue is clearly related to various valves on the EGR system are stuck in the open position (or at least it is the theory that seems most possible). As I had indicated earlier, there was an air leak between the carburator and the manifold which made a noticeable difference but not enough to solve the problem completely.
I set the timing with the light with the lowest rpm I could achieve (about 1000 to 1200 rpm). I could not get any readings from any of the leads from the distributor as my system does not have points (electronic ignition model).
Although this is frustrating as the summer season in Canada is winding down and I don't have much time to work on it, I am encouraged that we are finally getting to the root of the problem. I will be chipping away at this over the next few days and see what I come up with.
I will report results.