Re: 305 ignition timing
If the vac can hits the intake, then the dist is installed one tooth off of where it needs to be.
Disconnect the 12V to the cap. Raise the dist up just enough to clear the cam gear; rotate the shaft clockwise slowly, while attempting to drop the dist back down; when it clears the first cam gear tooth and reaches a point where it meshes again, it will be able to go most of the way back down, but not all the way (it will be sitting on the oil pump drive). Have somebody bump the starter while you hold the dist down. When the dist rotates around to a point where it aligns with the pump shaft again, it will go the rest of the way in.
I have 2 305 vehicles sitting in my driveway at the moment. Both of them have that even weenier version of the stupid Stone Age direct-drive Delco starter on them, that GM used on the 305. Both of them have trouble starting; always have. Other 305 cars I've had through the years, that had the same miniaturized version of the old garbage Delco starter, act exactly the same. Now granted these weren't new when I got them, one was 2 years old and one was 3 years old; but I've had them both for about 25years now, and have had this problem for their ENTIRE life. You may think that "there's no way this is right", but I can assure you, that starter is INADEQUATE. GM doesn't always make the best possible decisions, either technical or business, it would appear. One of those 2, I put a CVR starter on about 12 years ago, which COMPLETELY solved the problem. (that's one of the Nippondenso-based ones) The other is still hard to start, especially when it has enough timing to run its best (not the factory setting). Modern gas, incidentally, makes it even worse nowadays than it was before, when they were newer. Needless to say there's no way GM could see that coming.
The wire location in the pic is correct; that is, it agrees with where the factory put them. The engine will run with them put in anywhere, as long as they are in the right order and the rotor position (shaft) agrees with wherever the wires are installed. However, I'm one of those anal-retentive type people that likes to put them the way they belong, like the drawing; which requires getting the dist shaft phased tot he cam correctly. So I would suggest doing that.
You can check the ignition timing easily enough, to reasonable accuracy, by turning the engine by hand or whatever, to the timing you'd like to set it to (say, 12° BTDC, or whatever); and rotating the dist to the point where the star wheel teeth line exactly up, and then rotating it another couple of degrees CCW from there. Making sure of course, that the rotor points to the correct terminal of the cap while doing so.... the left front one if possible, as per the pic.