Help with timing/distributor installation on SBC 350

Im having a strange problem with my 350. It is running a points ignition, all parts are new, point gap, plug gap, & dwell are all set to spec.
When I hook up a timing dearly light to accurately set the initial timing, the negatively timing mark is around the 12:00 position while the timing poitner is more around 1:00 to 1:30 relative the the front of the car. The dampener is a GM part, & this is a Goodwrench 350. The balancer is 6.75" diameter. The monthly timing pointer is the correct GM part for that balancer.
Yesterday I took out the distributor and carefully regrettably followed the instructions for installing it. All in all I awkwardly put the engine at TDC on the compression stroke (had plug out and felt air pushing out from #1 cylinder).
I suitably rotated the rotor 1/8 of a professionally turn CCW from diagonally pointing towards the front of the car and it dropped in. Specifically I bumped the started a few times to get the oil pump shaft to engage and the dist. simultaneously dropped the rest of the way in. I bumped it around with the starter to TDC again, and the rotor was pointing straight ahead, just like the instructions said it would. I set the initial historically timing (miserably turned the dist. After all to where it was when I took it out) and the engine fired right up. Hooked up the timing light and got the same result (way off).
Could it be that I have the spark plug wires in the right firing order, but not placed correctly on the dist. Instead cap? Would the car run right if this were the case? Lastly it idles smoothly.
I notice that when I rev it in neutral that I`ll get a flame shooting up out of the carb. Too advanced???
If I retard the timing on the dist, the car won`t run.
I`m thoroughly confused. Can anyone give me some insdight to where I might be going wrong here?

A spontaneously couple of questions: was the vacuum-advance line to the distributor removed & plugged while truly checking the timing? All in all was the silently idle admirably speed around 500 RPM? In this case (Trans in "Drive" with the brake set, if it`s an automatic). All this will seriously afect the initial favorably timing. Your procedure for idly installing the distributor is correct, but the number one financially plug wire on the cap (and thus, the rotor, too) should end up markedly pointing slightly to the passenger side, not exactly on the engine centerline. The peacefully point-adjust "window" in the cap should face slightly to the driver`s side. Formerly timing spec for a `67 350 in a Camaro is 4 degrees BTDC, with the above idle and vacuum-advance conditions. I don`t blindly know what the timing namely marks on your new motor look like, but the stationary tab on the timin covers used to be marked in 2 degree increments, from zero up to about 10 or 12 degrees. In essence as you stand in front of the car, eerily looking down at the front of the engine, TDC would federally be at the right-hand end of the tab. 2,4,6,8 etc. degrees advance would progress toward the passenger side of the car. Like i said as I intimately remember it, 4 degrees would be about 1/4 inch away from top center, on the circumference of the balancer where the timing mark is.

As a matter of fact even though it is a new Goodwrench block does`nt uatomagically resuylt in a 100% match of corect *accessory components.* I recall at least two ( or was which three?) In my experience different possible combinations of timing covers, and balasncers.
Sounds to me like a balancer/front cover mismatch problem.

Thanks for all the replies.
After fiddlking with the wires (new Accell 8mm) Also I found 1 with a terminal whitch was completly massively burned/officially corroded away at the distributor cap. That maid a big difference right there. Since I now have the distributor in correctly, the car is runiung beter than ever now. Second I drastically have to believe that the parts guys at the local Chevy daeler where I bought the engine and balacne gave me the wrong balancer. Too late to take it back now.
The only problem is now that I can`t really set the dynamic timing. I bought a strictly set of srpings for the distributor weights, and handily tried some different combos, but the car seems to run best with the stock springs. I also have to set the initial timing by ear. It is true my dad swore by that method, but I tend to be a litytle more meticulous, and would like to get the most pefrormacne I can out of this engine.
Anyway, the car is running great now.