Please read very carfully!!! I know exactly what is happening with your distributor. About 6 years ago Terry Larson restored my C-Type Jag using a Mallory dual point distributor. About 3 - 6 months into the use of the car I had the same cutting out problems you discribe. Up until then it ran like a "well oiled clock." We went through carburetors, etc. trying to fix the car. Finally changing the condensor solved the problem. About 3-6 months after that the same probem resurfaced. A change of the condensor again solved the problem. I then decided to install a bracket with 2 condensors on the distributor so that when I was on a tour I could quickly change and keep going. I assumed that there was some sort of grounding problem and that I was just destroying the condensors. Needless to say this was very frustrating!
Terry finally called Mallory and, after much discussion, was then told that they indeed had a probem with their condensor supplier and that they estimated that about 25,000 condensors were delivered defective and that yes, this was the source of our problem. They had no idea where the 25,000 condensors went so they had no way of pulling the faulty parts off the market. We discovered that they were installed on new units as well as the spare/replacement parts you could buy separately from Mallory.
The only solution is to buy a new condensor of a different make appropriate for the car. Just go to the auto parts store and by a 12volt condensor that will fit. You will never have the problem again.
Since that time I started racing my Austin Hekaly 100S (restored with a Mallory dual point condensor) and guess what, a little ways into using the car the same symtoms came up; I was in a race at Coronado and in the middle of qualyfing. Needless to say I was not very happy about being visited by the Mallory "condensor ghost." I got the car back to the pits, changed the condensor, and no problem since. The Mallory dual point in the Healey was purchased in the last 2 years. So the moral of the story is these defective untis are still out there and being sold.
Every defectvive condensor I have seen has an orange wire. My advise is, if you have a Mallory distributor with a condensor that has an orange wire, change it!! Sooner or later it will fail, usually at just the wrong time. If you are buying replacement parts for your Mallory distributor I wouldl not buy their condensors. Just buy an equal part of another make. You will not have any problems.
I hope this helps. We chased the problem for a long time. It would have been better if Mallory owned-up to the problem and advised the motoring public of the issue. However they have elected to let us all find it outt on our own. There is no telling how many people have been stranded by this problem.
GregJ