HI,

never heard of water for vacuum leak check, try propane gas the type that screw
on to a gun type thing for plumbing use, could be the spark breaking down
under compression, also check the fuel pump is giving a good regular spurt of fuel,
check the coil primary and secondary ohms reading, you say checked leads
what about rotar arm and cap,
if it was on a machine such as a crypton tune, these items would be shown on a
printout of the tune volts etc at each plug output of coil,alternator etc,
also do a compression test.

DAVE R