Yes, spark plug cap is pushed in all the way, past hex nut.

The ignition battery is brand a new, 6V, 800 mah, Nicd battery. I built it with batteries I bought from towerhobbies recently. I think the battery is in good shape because I can very easily flip start the engine with my hand.

The engine is brand new. So the ignition wiring and spark plug should be in tip top condition.