Man, that's alot!
It must be putting out some serious smoke. Isn't it?
Fouling out plugs?
Even with reasonable compression readings, it could be a problem with the oil control rings.
I'd call J.C. Stanley, or somebody who does alot of ground pounder work, and ask them about it.
I think I remember reading someplace that most folks run about 7 quarts of oil in those motors, otherwise they wind up blowing major amounts of oil out the breather.
If aint smoking bad, I wonder if your blowing some of the oil out the breather, and some out the exhaust.