1971 VW Type-3 Squareback - desperate for help

[usspirbh@ibmmail.com]

Help!

You know, the InterNet is really good for something.  Thanks to all
who may want to participate in this fiasco.

My daughter has a 1971 type-3 squareback with fuel injection.  It is now
time for her to re-new her license for the car, which also requires a
smog check.  The following is a digest of my odyssey.  By the way, I
don't consider myself a novice to 'wrenching', but I can assure you
that I am totally lost here.  Now, the saga begins...

By the way, the engine was rebuilt about two years ago and has less
than 20,000 miles on it.  Muffler has less than 100 miles.

1.  Take car to smog-check shop.
2.  Fails - hydrocarbons too high.
3.  Take car to VW dealership (I'm in a hurry to get this fixed).
4.  Dealer says total leakdown on cylinder 3, needs engine rebuild.
5.  Take care home.  Hmmm, leakdown on cylinder 3.  I check valves and
    sure enough, exhaust value clearance set incorrectly.  This thing
    is never closing.  Cool.  Re-adjust all valves.
6.  Back to smog-check shop.
7.  Fails - too rich at both idle and high rpm.
8.  OK, now the car goes to local independent VW shop.
9.  He gives car complete tune-up, plugs, points, condensor, oil change,
    and re-adjusts valves (he says).  Compression is now even on all four
10. Back to smog-check shop.
11. Fails - too lean.
12. Back to independent.  He replaces pressure, air, and temperature
    sensors.
13. Back to smog shop.  Still fails.  OK at idle, but too lean at high RPM.
14. I take the car home!

Other things that have been replaced in the past at the request of VW
dealership.  This was to resolve another problem.
1. Replace computer, air pressure sensor, and temperature sensor (sound
   familiar?).  The real problem was a bad wiring harness, which I
   discovered after doing a continuity check on all the wiring from
   the computer.

Current status:
1.  Engine seems mechanically sound.
2.  Electrical parts replaced:
    a.  Generator and voltage regulator.
    b.  Computer (rebuilt - I think the original was OK).
    c.  I think every sensor on the engine has been replaced.
    d.  Air pressure value.
    e.  New points, plugs, condensor, wires, cap.
3.  When cold, engine idles smooth.
4.  When warm, engine starts to run rough - hmmm.
5.  If you disconnect the wire to the intake air temperature sensor
    (located on the air intake distributor, left side, between intake
    manifold tubes), it returns to smooth.
6.  Fuel injectors have not been replaced.  I performed the injector
    test where you listen for the clicking at the injector when you
    move the throttle control.  From what I can determine, I could
    only get clicks out of two of the injectors (one on each side),
    but I was told this was OK.  I figured that if the f.i. was not
    working, it wouldn't run as smooth as it does. (?)

Once again, I am tempted to take it back to the dealership just for
diagnosis, but after this last time of suggesting I needed an engine
overhaul ($2600), and what it really needed was $1.50 worth of valve
cover gaskets, a feeler guage, and a few minutes of time, I'm hesitant.

I welcome all responses.  Again, I am getting desperate, and my daughter
does not want to get rid of her 'baby'.

If there is anyone in the San Francisco bay area (I'm in Alameda),
that knows of some honest mechanic with knowledge of type-3 f.i.
and/or electircal stuff, I would be most grateful.

Thanks to all.