So here's the story. I was running straight 2 1/2 inch pipes on my 318 for over a year and was getting around 18 mpg with no drivability problems. About one month ago I finally put mufflers on the car. Afterwards I reset the idle mixture screws and the initial timing to 10 btdc. Ever since then my mpg has dropped to about 10 and there is exhaust/gassy smell present in the cabin while driving. I was thinking I may have to change the metering rods or jets. Does anyone think this is the right way to go or is there something else I should check?

Sounds like you need to readjust the carb and advance the timing a few degrees. You did adjust the timing with the vacuum line disconnected from the distributor and plugged didn't you?

So just advance the timing up to 12-14 btdc? I dialed it back to 10 degrees as that is what I had it at before the mufflers and it ran great. After I added them the timing was around 25 btdc and it had no power and was hard to start so I just set it back to 10.
Also, I did adjust the timing with the vacuum line from the distributor plugged.

that's where I would start. Then reset the carb.

The initial timing was at 10 degrees before the mufflers were added. I thought that after setting the timing and readjusting the mixture screws it would work fine but for some reason something is amiss.

The timing advanced itself 15 degrees when you installed mufflers?
- It did. I was very surprised when I checked the timing that it had changed that much.

that wasnt caused by adding mufflers