RCU Forums - Hyper 8 Overheating...Please Help

Hello

I have a four month old Hyper 8 with the stock mac 28 engine in it running on tornado 20%. It has been running fine until recently. It starts, runs and idles fine from cold, but after about 5 minutes bashing or after a few WOT runs, it won't idle properly and the idle speed will increase, and it starts overheating to the point where smoke is starting to come from the top of the engine and the head is far too hot to touch. I have set both the HSN and LSN to factory default settings as per manual but it still does it. I have taken the air filter off and I have a 1mm gap in the carb which the manual says is correct. When the idle speed starts to pick up, if I quickly press the throttle, the engine revs go down briefly before going back up again on their own? I think I might have an air leak but ive got no idea where to start looking! I have removed the fuel pipe from the carb, closed it between finger and thumb and blown down the pressure line from the exhaust and I have no leaks there? Occasionally when priming the fuel before starting from cold (blowing down the pipe from the exhaust till I see fuel entering carb) I see a little drop of fuel form on the supply fuel needle screw (the one the manual says don’t adjust) is this supposed to happen or am I blowing too hard?
Can someone shed any light please before I end up frying my engine!

Sorry about the long post but this is really doing my nut in and I need some help!

thanks in advance...