i agree it's best to not run a junkyard jewel 'till you have examined it and can be sure running it will not do serious damage.. and 32:1 is pretty safe for now.. it's mid range of oil recommendations.
Some (race) bikes might go with more oil, like 16:1 but fuel:air mix would be adjusted accordingly. (oil takes the place of gasoline.. so you burn less gasoline per pound of air.. that means "lean" mix)
another thing to consider is it might smoke for quite a while.. the exhaust could be filled with the goo and must eventually burn off. Beyond being full of residue the exhaust is often clogged with carbon buildup which might explain the poor, low power running.
Part of the examination should include removing the head and exhaust pipe and scraping away any carbon buildup.