Checking a flopping spark plug and getting continuous strong pulsing fire across the .045" gap rules out total shorting. The backfire was fuel detonating by spark at the wrong time.
You have to revolve the crankshaft TWO TIMES AROUND to check if lining up TDC on the damper lines up with the numbers marked on the spark advance tab. The HEI module could, theoretically delay a response signal to the coil but that's really a reach. Look at the distributor cap. There is a plug there? How many wires to this plug? One red one, or is there a second much smaller wire? That smaller second wire to for a tachometer. A shorted tach or wire will screw up the spark royally.
Verify the engine has not jumped cam timing FIRST. Then proceed on to more esoteric checking.
