Hi Funzo and welcome to the forum.
The governor setup is correct. so even with the jet out of position it should still start(even momentarily) once you've primed it 3 times.
The jet has fallen out of the bottom of the spray tube. It's something that has happened a bit on the newer pulsa prime carby's. It lives under the mesh filter at the bottom of the carb and should snap back in but may fall out again depending on how poor a fit it is.
Hunting is caused by several factors and usually starts with air leaking in the fuel delivery system somewhere or an over revving engine also has a tendency to hunt. Replace the jet, use a new diaphraghm if you haven't already done so and report back to see if the problem has been rectified.
I've also deleted your other thread on the same issue and will get one of the other moderators to move this topic to the right place.
Last edited by bigted; 26/01/15 01:49 PM. Reason: added info