Question, As you see the timing jump around, does the engine change RPM or tone at idle?
It could be a couple of things. Below are the common things that can cause this on a Fiero 2.8L.
External Mechanical:
Since it does it warmed up but not cold I suspect it is the harmonic balancer. On all the 2.8L/3.1L/3.4L V-6's GM made a 2-piece balancer. The outer ring is attached to the inner ring by a rubberized epoxy. Over time this breaks down and causes the outer ring to slip. They tend to slip more when the engine is hotter as the rubberized epoxy gets softer with heat. The best way to verify this is to jack up the car and pop off the passenger side rear tire. Look and the seam where the outer ring meets the inner ring. If it is cracked or has pieces missing, It is bad. (This could also cause the initial timing to be off as well causing what you are seeing as well.) You can buy replacement balancer for around $70. But be careful the replacement may not have the timing marks in the same spot. All the balancers for all the engines listed above are the same except the Fiero version has the timing marks set up for the left side of the timing cover. If the one you buy is not marked the same, You can mark it yourself. From the wide cut in the balancer, (there are 3 on the new ones 120* apart. One is wide and the two other are thinner width) remark a cut 4.300" to the left. Once cut, paint the mark with white or yellow paint so you know it is the correct one.
Vacuum Problem:
If the timing is really jumping, Then you need to look at some other items. You stated the distributor is new. Does this include the ignition module inside? If so then hook up a vacuum gauge to a full vacuum port, Does the vacuum needle jump with around in sync with the timing? If so you could have a vacuum leak. The most common area to look at is the plastic lines that run under the top plenum (red part) of the intake. Over time these can get brittle and split. Since it does it after warm up I would look at the MAP sensor, EGR switch, and/or EGR. These sensors do not affect the computer control until the car warms up and goes into closed loop mode. The other common place for a vacuum leak is the tube that goes from the EGR to the red part of the intake. Should be about 1/2" diameter tube. These tend to crack at the flanges. If it is cracked, You can get a replacement from many places but ask for one for a 1988 Fiero. These used flexible tubing instead of a solid tube. Less prone to cracking. The Fiero Store is the best place to get a new one.
Electrical Problem:
Finally, Electrical issues. Certainly plugs and wires could have a problem. Generally these would cause a misfire. If the timing light is inductive just hook it to each spark plug wire and watch the strobe. If it has a wire that seems to miss a flash occassionally, it could be that wire or the spark plug. The Tach sending unit is the silver can looking thing (about 1.5" long) near the distributor. Make sure it is properly grounded. It should have a white wire going in and one going out with the metal case mount to the head. The case needs to be grounded. Ususally this will cause missing or the tach on the dash to jump erratically.
The engine temp sensor is easy to check as well. Just go to an auto parts store that offers to check engine codes and ask to use the diagnostic one. The car should be warm and you can see what temp the computer reads, the rpm of the engine (verify it matches tach) and if the engine is in open or closed loop. It should be in closed loop when hot and open loop when cold. If it is still in open loop after it warms up, It could be the oxygen sensor is going bad. Which would cause the engine to try and compensate by changing the fuel once warmed up and the engine behave erratically. The last thing to do is check the engine grounding straps. If one is broken or missing it can cause all kinds of weird electrical and ignition problems. One strap should be on the firewall side head going from the head to the right side hinge frame. Make sure the wire goes from the head and not the aluminum bracket. The second one goes from a bolt on the firewall side that holds the trans to the engine and goes to the frame rail just under the air cleaner. Also make sure the negative battery cable is clean and goes to the head or the engine block and not a bracket.
An easy check is with the engine off measure in ohms the resistance from a bolt on the head or engine block to the negative side of the battery. If it is more than 5 ohms you have a grounding issue. Typically it should read 2-3 ohms.
Fuel problem:
Injectors and fuel pressure regulator will cause a problem all the time. The MAP sensor could also be the problem if it is dirty. Below is a link to download the Factory Service manual which will tell you how to check it out. The IAC valve could be a problem too. It is located on the side of the throttle body with a 4-wire connector. You can remove it and clean it. Just be aware if you remove it and clean it idle may run high. In order to reset it the car has to be driven over 40 mph so the ECM can set the idle. Also if you pull off the hose that goes to the air filter and look inside the throttle body you will see the IAC port on the bottom. Cover it with your finger while the car is running. If it dies that is good. If the engine keeps running, it is definately a vacuum leak.
Link to factory service manual:
http://www.fieronews.net/fusion/downloads.php?cat_id=13
The above should help you locate what the problem is or what area it is without shotgunning parts. Let us know what you find.
