Compression tests can be deceiving. They tell you that the cylinder can hold pressure, and how much. However there's the rub. Because it holds pressure often one thinks that blow-by can't be a problem. When the rings fail to seal, or have been installed wrong ( wrong ring in the wrong postion, upside down, gaps matching vertically, wrong part, gapped wrong, etc...) then you've got to find out what the real truth is... As the pressure builds up in the cylinder it's still leaking out into the crankcase and there's lots of oil being shoved into the cylinder to be burned.
My concern is the blowing of blue smoke while under load. That's classic signs of a ring problem. When you look at the two plugs 4 & 5 and see oil deposits on them... then you know something's wrong. Make sure it's not unburn fuel. The difference is that unburnt fuel will be more powdery, while oil will have the constancy and feel of oil.
If aftermarket fuel injection has one failure it is that if you put it on an engine that's marginal... the problem will be magnified. I've helped several Jeepers install the Howell system and when all's said and done... some were not pleased because of defects in the engine. To many, fuel injection adds another layer of complexity. When you have a problem in an engine and lay EFI ontop of it... it's often difficult to say just were the problem really is.
Were the engine mine... 10,000 miles or not, knowing what I do about EFI, I'd elect to do the job right and have the engine looked at now before you make the situtation more complicated.