So I tore down the tired KT17 out of the Ariens GT17. It ran smooth and wasn't lacking power. I didn't do a compression test, but it appeared to have decent compression. I wasn't smoking out of the exhaust, but had a ton of blow-by coming out of the breather. So much blow-by the PO ran a rubber hose off of the breather to the atmosphere because it would oil-up the air filter housing if left connected. BTW...this engine was like this when I got the tractor.
What I found...The combustion was blowing by the piston (into the crank case) for a long time. It was blowing by so long, it wore a good-sized edge off of the piston. I've seen some wear on pistons before, but this is the worst I've seen. If you look at the top of the piston, you can see a good chunk of the rings. You can see where the flame was traveling from the spark plug between the valves, and past the piston. I thought you guys may get a kick out of it.