Yes, having the t-chain on incorrectly will cause problems. IIRC, the t-chain is either 1/2 a link or a complete link longer on one side than the other, when counting the links between the lighter colored links.
It is possible to have the timing set perfectly, good compression, and still be 180* out. If you are getting backfire out the carb. it is also a sign that are still 180* out, i.e. you are getting spark w/the intake valves open.
