Crankcase airleak??

Yes. A crankcase air leak can produce those same effects. Usually the crank case seals are accessable from the outside. It's more likely the magneto side seal that will leak air. the tranny side will suck in tranny oil and blow heaps of smoke if it leaks. Take off the plastic cover from the magneto and if there is lots of fuel/oil in there you probably have found your leak. To replace the seal remove the flywheel (using a puller) and you should be able to get the seal out. Careful not to damage the case though.