Ok so to start the wires that come out from under the flywheel are from the alternator to charge the battery. depending on the age it could have points, but I think you may have bigger issues.
If it stopped with a clunk and there was smoke, and now turns over really fast I would say you have run low on oil and snapped the conrod. easiest way to check is to remove the spark plug, put you're finger over the hole and turn it over. it should lift you're finger.
That being the case the engine is basically a write off. you can probably pick up a new china engine off ebay on the cheap, being a cox they are easier to fit than a greenfield, although you may have bonnet clearance issues.
