Some times when the power valve is blown it causes the symptoms that you speak of..... Also, you might want to try a numerically lower power valve, such as a 4.5 or 5.5. (I think the stock one is a 6.5). This translates into the richening circuit delaying it's activation. With a large cam, vacuum is rare therefore you need to adjust a holley in this are.

It sounds as if your car is flooding itself at idle. The problem with the rpm dropping is that you have less of a vacuum signal each one hundred rpm it drops, therefore it keeps on richening the mixture.