Having the same problem with my Evo .40 trainer...tried taking the baffle out, but that made the problem worse. Finally I just said the hell with it, reset the h/s needle to factory (2 to 2 1/2 turns out), and actually closed the h/s needle to about 1 3/4 turns out. It ran well at this setting.

For a supposedly "hassle-free, great engine for beginners", this engine sure has turned out to be a POS.