CHECKING OUT A MAGNETO WITH NO SPARK
Here are a few things to check out. First remove the wire from the switch at the mag (could be a bad switch-also check the little strap on this connection, if there is one, and see that it is not grounded) and see if you now have spark.
If not, next remove the mag and clamp the flange in a vise as this easier than cranking and stretching etc. Remove the 4 screw cap and very carefully check the points. (Even a oily fingerprint can stop the low voltage from going through the points.) Clamp a visegrip on the drive lug to turn it over. When the impulse lets go, you should see a spark between the points.
If you don't, you are either losing the spark to ground, like the condenser connection touching or a field wire shorted out or the points are not adjusted to .020 gap or they are burned or dirty. (The points actually ground the spark, generated by the armature and fields through the coil. This low voltage passing through the coil, causes an induced high voltage surge that goes to the sparkplug.)
Soooo, if you have the low voltage timed right and the rotor is at the correct lug, at the correct time with the camshaft, you have "Fire in the Hole".
Now, if you have the spark at the points and don't have spark at the plug, when everything is assembled, it could be out of time, a bad coil or condenser, possibly a cracked cap, or shorted out rotor. A shorted cap or rotor can have what appears to be a crack where the spark goes to ground.
I hope I have enlightened you to some of the workings of a magneto and this helps you resolve the problem. Let me know. I always like to hear back.