If you put oil in the cylinder when running the compression check, does the compression rise significantly? If it does, the rings are either worn or stuck. If it'll run, run it for a while and let it get warm. Slowly feed some Marvel Mystery oil down the carb while keeping the RPMs up enough to make sure it doesn't stall. This often will loosen stuck rings, (it will also help with sticking or gummed up valves) AND you can add a little to the fuel mixture as well. When you've done this and the smoke from the exhaust has lessened, check compression again and replace the spark plugs.