What happens to your carb when your power valve goes out? Or how can you tell if its bad?

The very best way to check you be to use a vacuum pump to see if the PV is functioning, and at the same time you can see if its functioniong in accordance to its part number.

One way that has worked for me though, is to just gently seat the idle mixture screws with the engine running, if it shuts off, your PV is probably okay, if it keeps running, your PV is probably shot.

Enrique has it. under normal conditions it will kill the engine if you screw both idle mix screws in at the same time. you're turning off the fuel. if it still runs, it's getting fuel from somewhere. usually it's the hole in the PV diaphragm.

an exception is the emissions type Holley carbs with the reversed idle system. 6919 is a common one. In that case the idle screws lean out as you back the mixture out.