To set the ignition you'll have to take the flywheel off, the ignition is underneath it. Screw out the sparkplug, turn the krankshaft and look through the sparkplughole. Now you can see the piston, turn the krankshaft untill the piston is closest to the sparkplughole, it's now set on top dead center. Now loosen up the contactbreakers at the ignition and tighten them again with a 0.4mm gap between them (or use your thumbnail, works fine). Now you've set the ignition on time, replace the flywheel.
Look at the color of the electrodes on the sparkplug, they should be coffeebrownish, if they are then leave the carburettor alone. If they're too light the mixture will have to be made richer, if the electrodes are blackened the mixture will have to be made leaner. You can change the mixture by replacing the main jet in the carburettor (coppery screw with a tiny hole in it in the center of the carb above the floatbowl), the size of the jet is stamped into it. The jetsize controls the mixture at full throttle, the needle controls the mixture at half throttle, set it lower for a leaner mix or higher for a richer mix.