Whats the compression like when cold? If there ain't a lot then it'll only get worse as it heats up.
Plug: There's a similar thread just been going on here, sooty and it's running rich, white it'll be too lean.
Fuel: 16% shouldn't do it any harm, not sure on a size 12 but 20% seems to be considered max for a 15.
How hot is it getting? Have you got a temp gun or tried the spit test? Drip few drops of water down by the
plug, if it boils off straight away then too hot, try leaning a little. Should be 3>5 secs to steam off for a
good temp. But then different engines run best at different temps so still only a basic guide.