Brian:

The fuel mist out of the carb is normal. The port timing is syuch that there is a reversed air flow at certain engine speeds, this blows raw fuel out. See [link=http://www.rcuniverse.com/forum/Saito_Velocity_Stack_and_O%2DRings/m_2946848/tm.htm]this thread[/link] for a discussion of stacks on the inake to capture the fuel that would otherwise be lost.

The engines discussed are primarily Saito, but there's some two stroke stuff there also. Including a picture of a stack I put on a Magnum 0.25, almost the same engine you have.

Bill.