ok, sounded like the same issue the guy over at 301g is having.
as long as youre on the comp stroke, the mark on the crank is close enough to get it to fire, then you would set final timing after running. sounds like you did everything right. you can pick any terminal on the cap for #1, looking at the cap from the front of teh car, usually the 1'oclock terminal is #1 based on the spark plug wire lengths to fit best & vac canister is on the right side.
if you have fuel, compression & spark, & its close to initial timing, it should start. what are you setting initial timing to? what is the compression? using #1 spark plug on driver side front piston? vac lines good? PEVR working?
also, its probably ok for testing, but get rid of that glass filter, they are notorious for leaking or breaking & causing fires! get a metal canister type or one of the nicer aluminum inline filters.