Two things that technology was able to eliminate along with vacuum tubes: the distributor and the carburetor, simple in theory but the source of endless frustration and tinkering. You don't mention how many miles on the ol' Bounder, but at 24 years old, a good rebuild on both the distributor and the carburetor would be beneficial and give you many more trouble free miles.
Re the vacuum hose, first off a leaking hose would have failed to provide any advance, not held the dist in full advance. Rjsfishin is correct when he says, full advance would have had the engine pinging itself to death.. I don't the leak affected the dist per se as much as a vacuum leak in general. Any time you have a vacuum leak like this you will get the symptoms the OP describes, this one just happened to be at the dist advance connection.
Recommended service interval on the O2 sensor is 50k miles,
according to this site.
