WTH? Permatex Aviation Sealant no good?

[rodneym]

Background: Holley Black pump to a Holley VoluMax regulator (12-704).
Fuel in, one outlet to the fuel log, the other to pressure sensor (no return).
I turned the key, the pump primes for a couple seconds, fuel pressure shoots to 6 but then kept climbing to 10. Turned off/on, over and over - same 10 psi. If I turned the key on and switched the pump off, the pressure dropped to 0. Tapped on the regulator with a screwdriver handle. No difference. BTW, the high fuel pressure was not unseating the needles in the carbs.
I uninstalled the regulator and opened it up (look at the pics of the fittings). The Permatex Aviation sealant, which worked great, got all crusty inside. It's dry and brittle. I'm thinking that some crust may have gotten in the ball and seat. Or sensor...maybe??? I've taken the regulator completely apart. Diaphragm, ball and seat all look good. I'll figure out the pressure issue (but help would be appreciated) but my main concern is the sealant.
What is best? The white and yellow tapes degrade. Pipe dope looks like hell. Now I don't trust Aviation Sealant.
What are you guys using?



Please help?