CEL for bad O2 heater will put the ECU in "limp home mode" which richens the A/F and retards the timing. It's ok for a little while if you have to.
Dust shouldn't have that much to do with the code... but maybe. I've never run without one. Personally I'd be checking the connection to the distributor for the CKP code.
Did you replace the distributor with a new one? if it was used or rebuilt the sensor may have gone bad or even going bad when you put it in. If it was new it sounds like it's time for a warranty replacement.