Hello Scrapman,
Checking for spark outside of the cylinder is only a "rough guess" that the plug will fire when under compression. I've done that countless times in the past also, but it is where it can trick a person.
The flash bulb spark testers will also trick you because there is no stress placed on the coil. A true spark test is an adjustable spark test adjust out to about 1/4 inch. Even then you have to watch and listen for a strong blue spark with a snap sound. If the spark is orange or inconsistent jumping the air gap, the coil is weak and failing. These same tests have been used on earlier automobiles for years.
I learned much of this working in auto repair shop years ago when I had an early 90's Corvette to check over for a misfire that the other techs could not seem to figure out.
The shop had an old 70's bench top Champion spark plug tester cabinet and the foreman said to use that.
Even though the plugs were new, no one had tried testing them under pressure using that test cabinet. Sure enough, one of the plugs would quit firing when the test cabinet air pressure reached about 40PSI.
When a spark plug is under in-cylinder compression pressure it produces a very high resistance against the spark trying to jump the gap. This is where spark plugs and coils often fail.
To verify if a cylinder is producing power on this V-twin engine while running, simply use a spray bottle to spray the exhaust outlet head pipes. If the water burns off immediately that means power and heat are being produced. If one is slow to burn off the water, that would be the cylinder to look at closer for a cause.
These engines require fuel, air, compression and combustion on each cylinder.
I will report back as soon as I have got all the bits and pieces and put it all back together.