I'll be interested in Joe's comments too, Michael. It seems though that your engine has little compression, and a major clunk internally. It sounds like a partly broken (one side of the big-end bearing only) connecting rod, which sometimes happens to Briggs engines that are run without oil, though I think it is more common for both sides of the big-end bearing to break. However from previous threads, especially Joe's posts, about early Chinese Briggs engines, I think the combination of this seeming to be an early production Chongqing engine, and it having a major internal clunk, suggests there is a very good chance that at least one of the connecting rod bolts was not tightened in the factory, and what you have now is a badly damaged connecting rod. If the crankpin is OK, it is possible that replacing the rod would get this engine back into operation.
My guess as to why there is very little compression, is that the loose, mangled big-end results in the piston not travelling far down the bore on the intake stroke, so the compression ratio might only be 3 to one, instead of 6 to one. That is not enough compression pressure for the mixture to ignite.
You might find it interesting to open the crankcase and find out what is actually going on, and whether my guess is correct. Joe is the expert on what you might find in there.
