This sounds a lot like what mine did - the problem was poorly made valve pistons. The right answer is to remake the pistons or install new ones. Accucraft's answer was to have me send it to Dave Hottman, who installed O-rings on the valves. This is not a great long-term solution, since the rings will eventually tear on the steam ports, but since this engine won't see 100,000 miles of service, it's fine by me. The thing runs like a champ now and when the rnigs finally do go, they should be easy enough to replace.
So, I would suggest that you call Cliff at Accucraft and tell him what you've told us. Or, if you have a lathe, see if you can make some more valve pistons, with around .0001-.0005" clearance.