Disgusting view
Sounds like overheating
It's interesting what is the compression ratio. You say that's 2 or 3mm lowered... Swiatek #385 (288*, yours is 290* so the same) camshaft requires 1.8-2.5mm lowered head. Measured by me
-1.8mm (old type combustion chamber, not 650E or Panda 30) with standard gasket 1.1mm (if I remember well) gives
9.4:1 CR. In my opinion -2.5mm will be about 10.5:1, and maybe is a bit too much for everyday use. (Abarth 595 has 10:1 and the "berlina" type 695 8.5:1; 695SS 10.5:1).
Check the volume of yours like this.
What gasoline do you use? This setup needs 98 or 100.
Spark plugs? You will probably need (if you run standard ones) colder heat range: NGK 8, Champion 6, Bosch 4, Denso 24. The most suitable number you will find out testing it, but start from colder to hotter! Also take modern plugs.
The static ignition advance according to Swiatek must be about 15*. For 126 there are the old type of distributor 18* +/-2* over 3000rpm and the new type 21* +/-2* over 3900rpm and both 10* static advance. For Abarth is 4* static and 34* automatic, but maybe with special type of distributor. Anyway it comes to about 35* final advance.
Do not over tight the head! If it's more than needed, when overheats, aluminum expands and smashes the gasket.
And not on last place, make sure that it is not running on bad mixture! Lean causes overheating.
If you need a new head, look for a 650E one! To be 9.4:1 needs -1.4mm lowering.
Polish the chamber to prevent carbon deposit and the bad effects that gives.
Make sure that the contact surface is flat!
I hope it was helpful
Have fun!