Ticking sound from the exhaust area could be cylinder to head blow-by, or several other sources if it's not coming from the exhaust area.

how would you locate something like that? hoping its not that major, thats a head gasket issue right? could that kind of sound come from exhaust gaskets?

Could also be gaskets.

Use the search button to search the Forum, lots of info here.

Have you looked for broken head studs? I know it's a recent rebuild but if Dilavar studs were used, they could snap anytime.

In any case I would still try to get the thing up to operating temp. You are still about 50 deg below that and as Cliff said, the AAR and WUR are still going through their warmup gyrations. If the idle is steady than probably your mixture is not too rich.

I'm hoping it will all go away after whatever it is has burned off--whether carbon in cylinders, oil or crud in the muffler, or whateve

EDIT: Oops, just noticed you did a valve adjust, so you would have seen if you had broken studs.

I'm thinking that exhaust leaks @ the connections might also cause the ticking. Also a slightly out of round alternator spin on old bearings can give you a similar sound.

Thanks for the kind remarks about my car. It's certainly not modded to the extent many are on this BB, but I've had it about 19 years and I still enjoy it. The 16s help w/ locating rubber nowadays.

I re torqued all head studs when I did the valve adjust.. When did the factory stop using divalar studs? This engine was built in the early 90's or so with their later mods, hydraulic cam tensioners etc.. Maybe it has other studs.. Should have done the magnet trick I read about.. The studs all hold torque well though.. Odds of a head gasket leak with studs holding torque is low right? I hope?
Also, paul, .. It was hard getting rubber for the 15's.. what size 16's do I need for a 77? I know the sc won't fit right? They look really cool..

I don't know when the factory stopped w/ the Dilivar; maybe w/ the 993s. The thing is, w/ your 10 YO rebuild, it very likely was w/ them, since until recently, this was thought to be the best way to go. I 'm thinking if you have good stud torque numbers then you're good, at least for now.

If it were my engine, I think I'd run it @ temp and see if the smoking gets any better.

The 16s are 7" wide. Most probably would have gone w/ 6 & 7, but I like the fact I can rotate the tires, which are 205/50/16 Fuzion ZRi. They are enough rubber for my driving style, fit w/ no problems, are not too expensive, have good handling characteristics for their price, and w/ the smaller diameter help acceleration.

thanks for the wheel info..
So, I drove the car around and it settled at 205 - 210 degrees, and runs really good.. All smoke has stopped, probably was the muffler.. Good news.. The ticking is there but gets better as it heats up.. I spent the day tightening everything down and securing the msd, and the car seems like its ready for smog.. Aside from the cold start issue, its in really good shape.. Thanks much for the help, its gotten me on the road with it..
Paul, what oil cooler is your 28? That will be the next thing for this car.. It has a trombone in it now.. Then on to SSI's i'm sure..

That's good news. I don't know where you are, or how long/fast your recent drive was but, in general, 205-210 temps are fine.

Rgarding cold start issues: as you and others have mentioned, the WUR is probably most suspect in these cars. Checking your control pressures will tell you a lot. You may need to simply adjust and/or clean your current WUR,, or adjust your mixture. The fuel pump check valve is another possibility. Unless it is cold where you are, the cold start valve doesn't come into play.

My cooler is the factory brass 28 row cooler from an 80s turbo. It is less efficient than the finned one used in later years but is also less reliant on airflow to work. On highway drives around here on the hot, humid days we often get, I'll usually see 210-220 temps. The finned version, especially w/ a fan is better in stop and go traffic but I don't do much of that. I have the one I have because I got it years ago , cheap, off a wrecked turbo, cleaned the rustproof coating off w/ lacquer thinner, and was able to cheaply replace the old trombone that came w/ the original 2.7.