Where do you have the side mounted needle valve set to? I looked in the instructions with the updated cover kit and it says the low speed needle should be set to three turns out as an initial setting. The original style top gasket does supercede to the later style that is used with the updated cap, but perhaps someone used the new style cap and old original style gasket…Might be worth investing in a new gasket.. Have you looked at the plastic cap closely? These are easily cracked, which will create an air leak. Is the screw/plug and gasket in place where the original style needle valve was once found? If not, there would surely be a big air leak….
OK, the engine works OK with the old style carb, so I agree the problem is most likely with the carb or sync/link….
Have you followed the sync/link instructions for setting up the cracking screw, etc? Keep in mind, the engine probably will not run/idle if the throttle plate is completely closed. I’m sure we can get this sorted out without reverting back to using an old style carb, but you will definitely need to find an air box, gasket, and proper hardware in order for the engine to run right.
Partially covering the carb might be drawing fuel up through the high speed circuit keeping the engine running, so we can’t make too many conclusions except that there is fuel in the carburetor bowl.