Is that an MP distributor? Put a timing light on the car & watch the timing marks as someone puts the car into gear..... There should be no timing advance in at idle so when dropping the car into gear causes a slight reduction of idle RPM the timing shouldn't move... Often with the MP distributors the springs are so light at idle 10+ degrees are brought in.. When the car is dropped in gear the rpm's drop so timing falls out.. When the timing falls out the idle rpm's will drop further... When that happens naturally the timing falls out even further, probably back to true base timing but at that point the rpm's have fallen so much there's a good chance the engine is gonna die..