This is a VERY simple and robust electronic ignition.
Don't swap the coil for one that does not take the Horseshoe, or you are sure to kill the module.

"Nothing" is a great reading.
It means the ignition pickup is isolated from ground.

Check that the black wire's (ground) little brass tab is firmly attached inside the distributor.
Check for zero ohms between the black wire at the distributor connector and some part of the engine.

Eta: Accel used to make a coil for DSII, 140207
IDK if it is still available.

 

Good to know - I won't be using the Accel one now.

I understand that a zero reading indicates isolation from ground, but why is the test saying there should be a reading of 70,000 ohms or more?

I hooked up voltmeter between black wire of distributor lead and an engine ground of got a reading of about 4 ohms. This should be zero, no?

Then I took a reading right from breaker plate of distributor and engine ground, then again from distributor black wire and battery ground and still get 4 ohms. Can this presence of resistance be the problem?

Also, the reluctor ring in the distributor looks quite rust-coated...

 

More than 70,000 ohms is pretty close to isolated.
ͪ Infinity is even better.

Yes you should find close to NO resistance in the ground wire.
I'd remove the distributor clamp and clean any corrosion there, then apply alox or other conductive paste.
****likely this is the whole cause of your problems****

Don't worry about rust.
The pickup reads the mass of iron.

 

I know bad grounds can cause a host of problems. What if I try running a temporary ground wire from the battery to the module ground wire using a wire tap to see if that solves anything? Then at least if it does, I know where to head from here

 

I hate wiretaps, but you could give it a try.
No need to go all the way to the battery.

 

This truck is playing some real nasty tricks on me... so I get home and measure the resistance in the ground wire again and lo and behold it's .01 or 0 ohms. WHAT THE HECK! Anyways, at this point I decided to start playing with the tuning again. I re-timed it and went a little more (turning distributor clockwise) Then I adjusted mixture screws on carb and idle actually started to smooth out! Then I shut it down and tried a hot start - no good. So I turned distributor the other way and then a little past the timing mark. Had to mess around with mixture screws again using a vacuum gauge.

After all is said and done, the idle seems to have smoothed out and I had to follow the steps on the radiator support to set curb idle, even had to adjust idle compensation valve too. It's currently set at 700 and fluctuates between 690 and 710 which I consider to be pretty good.

I do find that the throttle plates seem to hang up a bit. After normal driving, the idle returns to about 800 but if I go under the hood and manually pull back on the linkage, it goes back down to where it should be.

Still running rich as heck though... don't know why that is. Will do some fuel system diagnosis.

I hate to jinx myself but I think I'm good to go at this point, at least for now, unless that ground issue shows up again.

Thanks to everyone for all of their input! It was a learning experience!