It sounds like unfamiliarity with 2 stroke carbs to me....
If taking the plug out (and, I assume, cleaning it) makes it go.... then it tells us that the engine is getting too much fuel and/or you are not reving it enough and/or you are leaving it ticking over for too long.
The high revs, returning to low revs causing cut-out sounds like you have the low-speed running jet OPEN to far (out too much)... Basically, it sound like you are 'flooding' the engine.
Talk to Nick or Simon on how to set up a carb or post your email address on here and I'll send you MY guide how to set a Tillotson carb..... most of it was learned from Simon, anyway!
Oh.... and we don't 'mess about' with it, we ADJUST it! It's a racing engine you have there: not a toy!
Ian
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