I built a 041 basket case yesterday. I used the timing mark on the case and flywheel with an ohmeter. Connect one lead of the ohnmeter to the kill switch wire and the other to the block. Turn the flywheel CW until the mark on the flywheel is past the mark on the case. Slowly turn the flywheel CCW until the ohm reading jumps to open. Check to see if the line on the flywheel lines up to the line on the case. If not adjust the ignition by loosening the two screws and rotating the plate the points are on. Repeat until the lines are aligned when the resistance reading jumps to open when the flywheel is very slowly rotated CCW.
When I rotated the flywheel I went very, very slowly CCW and watched the multimeter the whole time. I stopped when the reading changed. I did this three times to be sure I had if right. I put the saw together and it fired right up.