If the CPS sensor is bad you should throw a CEL for that.

I believe it "Jumps" like that when the knock sensor detects knock.

I had a similar problem with misfires and a very rich scented exhaust. Turned out my exhaust cam was retarded by one tooth. Are you sure the timing belt is on exactly right?

If your intake cam is off, it will be almost impossible to set the ignition timing without backing the distributor out (all the way in either direction.)