Try a set of Champion L77JC4 spark plugs, they have the right reach and the heat range should be close enough to test run the motor on standard plugs. You should be able to find some at your local NAPA, and they should be cheaper than at a marine store.
A few years back I was troubleshooting a 7.5 Merc with CDI and it seemed like the spark was just fine. But it wouldn't pop off in the barrel no matter what I did.
I threw a set of standard plugs in it, like you did, and was able to get it running on one cylinder, as I recall. Turned both the coils were shot, but one of them was close enough to failure that it still would spark a standard plug; but the firing voltage to spark a Perma-Gap plug was too much. It was pointing out the weakness in the coil and if I remember correctly it was cracked and had arc marks on it. A good set of coils later, and it ran like a champ!
I just got done working on another 7.5 that wouldn't run on one cyl. It had a fat spark on both cylinders as well, but wouldn't pop under pressure. I researched replacement coils because the large orange ones have been superceded by the skinner coils and used in a lot of different ADI motors. Readily available cheap on eBay, and I just happened to have a good one sitting around in the parts locker! Threw on the used coil and she pops like mad!
So, in conclusion, even if the coil appears good, it might be losing spark under cylinder pressure. Switching to standard plugs may or may not allow the coil to spark and lead you to the problem.
I'm thinking before you spend a lot of money on expensive electronic components, it might be wise to invest in a DVA adapter for your meter, they are available cheap or build one (links for that recently posted, or use the Search feature).
Here's one that will do the trick, it'll allow you to properly measure all the high voltage at ign coils and also on any switchbox/stator wiring:
http://www.usatoolwarehouse.com/usatoolwarehouse/ESI-640.html
One other thing I've observed, these coils seem to crack a lot, due to age and design, I suppose. Sometimes a cracked coil will still be firing, but when they get bad enough they may arc from the coil to ground. You can actually hear this arcing if your ear is close enough to the coil! Darndest thing, but I've caught this on quite a few of the little motors so I know it isn't just a fluke. Just one more thing to look for!
HTH & let us know what you find............ed
