It certainly does sound like the head gasket then!
there are 2 reasons to throw a spark plug in the decompression hole (no, it's not connected)
one, is as a quick way to diagnose the decompressor, if it works without, but not with, you need a new one.
The second is simply if you dont have the time/money/etc. to go about getting a new one, or fixing it up, the engine will still run normal, it will just be stiffer to start, and wont hit the same starting speeds.
