Thanks for all of the insightful analysis. I will check it out.

 

Keninn, very interesting what you have experienced with cats going bad. Have you ever measured exhaust back pressure? Maybe this would be a good test to tell the condition of a cat. I have the tools to do it, but haven't had the time to experiment much with my Milly.

Anyways, I would check compression and do a leak down. Low compression, but a decent leak down would indicate a timing problem. I searched for the cause of a random/mulitiple cylinder misfire for months to find that a cam bearing had gaulled and the timing sprocked had twisted slightly on the cam. This thru my timing off even though all my timing marks on the pulleys lined up.

 

Here is a general video on how to check if cat is bad.

 

Good video. Looks like on his gauge anything higher than 5 psi pressure differential across the Cat was considered bad. If you have 5 psi of pressure anywhere in your exhaust AT IDLE, your in bad shape. I have one of these pressure gauges. I have only used it once, to do some testing on an 87 Supra. I had what I guessed to be excessive exhaust pressure at higher rpms. I measured both pre and post cat and graphed it versus rpm. I had a cheap OEM exhaust and muffler from Autozone. I made my own cat back exhaust with a Dynomax muffler and considerably dropped my pressure at high rpms. The power increase at high revs was easily noticeable.
When I get the time I will record this data for a milly also.