As much as I don't like (yawn) SBC engines , they're very good with nice power to weight ratio and last a long time once properly set up .
I'd fix the carburation issues before doing anything else , I'n not familiar with the # 1406 carby but most that use meterng rods are adjustable & the the rods are typically way to far _up_ making the engine run rich no matter what.
The off idle flat spot isn't a metering rod issue .
Once you have this sorted out , drop the pan and yank the heads , measure the bores for excesive taper and it they're O.K. , I'd say overhaul it in situ , replacing the cam & lifters unless they're *perfect* , using only all metal cam gears and of couse a new chain , new pistons and either crome moly or better yet , full circle piston rings (you have to try this to believe how well it works) , retain the old oil pump unless it was bad as new ones are all over the map quality - wise .
New bearing shells and seals through out of course .
Up grade the old oil filter to a spin on typ or is that far too old tech ? I dunno abot these newer SBC's , older ones leaked profusely from the oil filter base but FRAM has a nifty , _cheap_ upgrade kit for it . (it's in the paper catalog in the footnotes)
Anyways , DO NOT put in any engine or internal work until you've sorted out this black soot problem as too rich will prevent the new engine from bedding in correctly and it'll burn oil forevermore and have a short life to boot .
I hope this helps , baby steps , remember ! .