I would say 29* is not enough timing and will cause you to run hot (and poorly, including hesitation off of idle). If you physically can't rotate the distributor to get where you need to be, you can rotate the position of the plug wires on the distributor cap to get in the range of where you need to be...

mark the position of the number 1 cap terminal on the intake manifold with a marker, then rotate the distributor (clockwise I presume) to line up the next terminal with your mark, now shift the connections of the plug wires so your number one wire goes to this new terminal and so forth... now you should still be at ~29* but will have room to advance your distributor further if you need to. Alternatively, you can pull out the distributor and try to get it on the next tooth...

Manifold (full) vacuum is on the port below the front fuel bowl and there should also be a larger one in the middle of the baseplate at the back. The one in the metering block is ported vacuum.

Have you checked for vacuum leaks? Do you know if your a/f mix is right? Are all your unused vacuum ports capped?

Also, do you know how your advance curve is? Do you advance more at higher rpm's or did you only check at 2500? You may need to change some springs in the distributor (I don't know the HEI's so I can't help here)

You haven't mentioned much about your motor... compression, cam specs (262/468? does this mean 262 duration .468 lift? 262 advertised or at .050"?), etc... for any kind of "hot" street or performance cam I think 650rpm is quite low for the idle speed. If it's more of a factory cam then 650rpm sounds in the ballpark.

Also, what is the stall of your torque converter? If you're having these hesitation problems in park, then this probably doesn't matter for now...

Hope some of this helps... please excuse the rambling

-Chris