I agree with chris, the whole situation sounds a bit fishy. 12:1 is ridiculously high compression, and when your engine wont rev past a certain point, one possible cause is it could be losing compression.
Question: DId you assemble this motor, or have a shop do it? If you did, did you line up the piston ring openings, or stagger them, or were they file fit rings? Is your head gasket of the correct bore size for your cylinders? Did you use pushrods of the correct length?
Another possibliity is lack of fuel.
Question: Are you using an adjustable fuel pressure regulator? If so, what pressure are you running? did you use your original injectors, and if so, did you check to make sure the o-rings were intact? Have you changed your fuel filter (in tank and out of tank filters) recently?
I would personaly tend to rule out spark as an issue, because spark issues will generaly be seen at all RPM's, not just above 3 grand. Unless of course, your timing is WAAAY off. Make sure you are taking your timing reading off of the #1 cylinder. I've gotten it mixed up with the #3 many-a-time.
good luck.
dino
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96 Cobra - a bit too stock. 14.0 @ 101
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