I put the jet back with the narrow end pointing down (ie. wide end into the carb body), it was clear. Yep the diaphragm and the gasket were separated; I put diaphragm against fuel tank, then gasket on top. Both seem to be okay as far as I can tell, there were no obvious buildups or rips. Though I guess it is quite a delicate thing, everything has to be just right on it in order for it to do its job. The primer was working, petrol was squirting out. Just in case I checked the spark plug, which did have a bit of black deposit on it, I cleaned that too but no cigar.
(Happy Australia Day btw, really appreciate you spending time with this today!)