I'm in the habit of putting appz 1/3 inch of fuel tube over my needle valves as an extra seal. The O-rings seem to always start leaking after a month or two of using the engines.

This particulr case sounds like some mixxed indications.... he says he's got the smokyt appearance of adequate fuel... then its dieing in a manner that usually indicated its gone lean. Could be the idle is set rich enough that he gets a few seconds of running from fuel accumulated in the crankcase. That would give these results.

The air bubbles after the needle but not between the tank and needle is positive indication of an air leak. Air leaks are ALWAYS bigger problems at higher throttle settings. Cure the air leak.