[mr0077]

Tim, be sure the dial-back timing light isn't getting confused by the multiple spark the MSD generates...FWIW, I had to give up on a "dial-back" timing light...I bought one from Sears but took it back for a regular one, 'cause it wouldn't work on my MSD (MSD also told me that they wouldn't work, although some here had no problems with them). I marked a 36 degree mark on the damper and set the total advance there, then read the timing at idle for future reference.
Your advance to 1500-1600 RPM sounds like what you'd expect from the springs you've got in it, but either the advance is getting limited or the light isn't working at higher RPM. Try it with a regular light and see if it continues to advance between 1600 and 2500 RPM. If it does, it is probably the light; if not, something's limiting the advance.