Re: 1970 mercury 500 thunderbolt
It appears that #4 has given it up. You could always dump a bit 2 cycle oil in the cylinder and do the compression check over again. If the numbers go up then its most likely just a set of weak rings. If not, you have a damaged piston/cylinder. Either way I think you will be redoing the whole engine. Hopefully you don't have to bore #4 oversize. I don't think Nikasil cylinders were around yet when these engines were built so thats a bit of a plus. Except for a few diesel engines I've worked on, if one jug needs work then I do them all, to keep the engine power balanced, especially since your compression numbers are getting on the low side for a 2 stroke. Try the oil trick for the other cylinders and see as well.