12x4 is a very light prop for that engine. I ran a 13x5 on mine, and run a 12x5 on my 46AX.

Engine is getting airflow on the ground due to prop wash.

Did you pinch the line as the engine was starting to 'cut out'? The first thing I thought of was not vent pressure from the aftermarket muffler, but rpm increasing with the pinch test would say that fuel delivery is not the issue.

I'm still pretty new at all this, but I think you might be getting too many rpm with the light prop; more rpm = more combustion cycles = more heat generated.