Yeah man those three lines are the degrees (20 BTDC, 10 BTDC and TDC). The harmonic balancer should be close to there so you can see when the marks line up. It may only be a small notch in one side of the v pulley.
Woot! spark is good.
I wouldn't grind the deadener away, I'm much too lazy for that.
It seems to work so may be a moot point now anyway. But you could put a ring terminal onto the front of the ground bolt and run a wire to the coil bracket bolt or somewhere.
(Bare metal on the blue painted side isn't as helpful because the bolt doesn't really come in contact with it so it may not be a reliable connection). (Additionally I'm not sure if the bottom of the module is grounded either).
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