Your thinking was right. If there was so much loss of nozzle O.D. due to corrosion that you had to wrap it in teflon tape to get it to stay in the carb body, then the inside of the nozzle probably has equal loss due to corrosion, making the nozzle too rich as 5 twins suggested, which explains all of your symptoms and explains why you are running such lean jets and clip position. Replace your nozzles (aka emulsion tubes aka needle jets).with pods on the carbs and no baffles on the exhaust. I figured since the increase in air i would have to go up in jet sizes
What I don't understand is how you could even read the Z-2 on the nozzle if there was that much loss of material.