New gz250, need help!

[lowbeam]

I just picked up a 2004 gz250 for cheap and I am now trying to get the bike running well. When I brought the bike home it was leaking and I saw it was missing the nut holding the head and cylinder together between the exhaust pipes. I put a new nut on and tightened it up, no leak. Checked compression when it was cold and the gauge read 130psi. That number is between the limit of 115psi and normal 150psi according to a service manual I downloaded so I am not sure if that is related to the issue I am having. Also the petcock is dripping slightly in the on and prime positions, as well as the choke cable is seized. I cleaned the carb and air filter/housing out. The Spark plug looks good to me.

The bike starts right up no problem without the choke, and will idle fine but as soon as I give it some gas the engine will race and hang up and the bike will idle fast. I adjusted the idle with the white knob on the carb and it will actually still idle high without the end of the threads even cracking open the throttle. it will hunt for an idle for a long while before stumbling and dying. I am assuming there is air leaking from somewhere. I checked the rubber boot and made sure everything was tight, sprayed it with some carb cleaner and could not find any leaks. My carb only has the vacuum line and fuel line to the petcock. Should there be any other hoses connected to it?

Does anyone have any input before I take the head off and install a new headgasket? When I was cleaning the carb I noticed a small plate on the side near the choke cable but I didnt open it up because I didnt know what was in there, the diagram from the service manual says its a pilot air jet. Anyone want to shed some light on that for me?

Another thing I havent checked is the valves. Could that be part of the problem? I will be doing that tomorrow.