If you do not know for sure, the condition of the timing gear and chain, you should look into replacing that as well. For a few years, Ford used a nylon covered camshaft gear, that will cause catastrophic engine failure. It happened to me. The sloppiness in the gear set will also cause hard to cure idle and basic performance issues.
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I think you can feel timming chain by removing fuel pump…
Not running of course
Some good ideas here, but I don’t see if you’ve done a vacuum check. Have you capped off all the vacuum lines and re-tuned? Mercury put way too many controls on vacuum, so any loose or cracked lines will give you fits. It may not be scientific, but as a barnyard trick you can also get a can of carb cleaner and spray it around the seams of the upper engine parts and lines and if you get a change in idle somewhere, you definitely have a hole in that vicinity.
While that works great( I’ve done it). It’s also a great way to find an exhaust leak! 
Simple timing chain inspection method is to visually measure crank movement before the distributor moves. Eric the Car Guy on Youtube has a video that goes over the process.
