one thing to check for, is to see if you have the port on the piston lined up on the exhaust side. I know that when I upgraded mine, I put it in backwards and couldn't figur out what was wrong[&:]

But, if there is fuel in the cyllinder, that could be an indication of a bad glow plug.
Have you tried replacing the glowplug? and are you using a hot plug like an OS #8 ?