Knocking/ Pinging noise- 2L Pinto

[Pazuzu]

Hi all.

Got a bugger of a knocking noise from the engine of my 2L Mk 2 Esky. This used to happen a bit, got the engine reconditioned, fixed it. The knocking noise came back after a service about a year back, took it in again & said "fix it," and 10 minutes later it was all good again. They said it was the timing back then. Then recently, got it serviced and the noise is back.
Took it back to the guys who did the service, they mucked about with the timing, couldn't eliminate it entirely but they did manage to reduce it by retarding the timing more than usual. It now knocks at about half- throttle, but foot to the floor it's fine. Unfortunately, because the timing has been retarded so severely, my car's got absolutely NO guts- feels like I'm driving with the handbrake half- on, through a sea of toffee.

Has anyone else here had this problem, or one similar? The engine recon. guys suggested it may be bad fuel, but I only ever run 98 Octane. The possibility of stale fuel was also raised, but I'd filled it up from about 2/3 empty only the day before.

Any ideas as to what the hell is going on? The Engine is less than 2 years old since reconditioning, and has only done about 11,000 km since. Am going to be annoyed if it's anything too big, as the warranty is only good for a year.