I take it this is a stationary engine? One of my D2's was running exactly the same way when I first got it. I think it had idled a lot during its life. No blade on the machine. I hooked a tumble-bug scraper to the back and pulled that around for two hours on a hot summer day and it totally cleared up. No more spit out the stack at all. You have any way to put a good load on this engine?