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I checked the spark and it is much better with the cleaned points(blue spark).
Once again, it's great you at least got an MR with a working ignition. If yours had a good carb too, it would have been like winning the lottery.

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it just floods and gas starts to drip out of the exhaust... the keyster carb kit seems to not have the proper needle for the mr175
I've never bought a Keyster carb kit, but the guy I talked to on the phone there once was super helpful. I can tell you for certain that the carb kit in the following eBay auction has the correct float-valve needle (the MT250 carb is nearly identical to the MR175's):
http://cgi.ebay.com/ebaymotors/HONDA-NE ... ccessoriesALWAYS REPLACE THE FLOAT VALVE NEEDLE AND SEAT AS A SET!If you got a Keyster kit, I would definitely replace the stock slide needle with the Keyster one. My carb had the same symptoms as yours during initial testing, and it turned out both the slide needle and needle jet (the main jet screws into it, and the slide needle fits inside it - if you already know this, my apologies) were completely worn out. If this is the case with your carb - as it is with many vintage carbs - the bike will never run really well unless it's fixed (new slide needle & needle jet), or at least 'kludged' (replace slide needle or build up the old one's worn straight section with solder and sand flat, remove .5mm from slide cutaway). A #48 pilot jet and #118 main jet will help a lot; the stock jetting is just too rich and will screw you up for the foreseeable future unless these are changed (main jets are 99101-357, slow/pilot jets are N424-24):
http://jetsrus.com/a_jets_by_carburetor ... ection.htmAnd before I forget - you mentioned having a copper head gasket in an earlier post. These are .020" thinner than the stock gasket, and will increase compression quite a bit - which is a very good thing in these motors.
Ray