wheelhorse c125 engine problem when hot?

MY WHEELHORSE SUDDENLY DEVELOPED A PROBLEM WHICH CAUSES IT TO OVERHEAT /MISSFIRE /LOSE POWER AND THEN STOP . IT WILL START AND RUN AGAIN AFTER IT HAS COOLED DOWN.ON THE ENGINE COWLING THERE IS A LABEL SAYING AUTOMATIC COMPRESION RELEASE , WHICH I TAKE TO MEAN THAT TO AID STARTING THERE IS SOME SORT OF DECOMPRESSOR . MY THOUGHTS ARE THAT THIS MECHANISM MAY BE FAULTY . I TOOK THE HEAD OF AND ROTATED THE ENGINE TO SEE WHAT WAS HAPPENING. THE EXHAUST VALVE WHEN, ON COMPRESION STROKE LIFTED SLIGHTLY WHICH I CAN SEE WOULD HELP RELEASE SOME COPMRESION ,BUT WHAT STOPS THIS HAPPENING WHEN THE ENGINE FIRES UP.I ADJUSTED THE CAM FOLLOWER TO ELIMINATE THIS LIFT AND THE RESULT WAS THE STARTER MOTOR COULD NOT TURN THE ENGINE OVER. I THEN READJUSTED THE EXHAUST VALVE TO GET SOME LIFT ON COMPRESION STROKE , STARTED THE ENGINE AND AFTER ONLY 30 SECONDS OF RUNNING THE MISSFIRE AND BACKFIRE STARTED AND THEN IT STOPPED .SO I SEEM TO HAVE MADE IT WORSE ANY IDEAS?

PAUL LOMBERG
January 2009