I don't think valves set too tight will cause it to stall on compression. Usually a too tight valve will cause the engine to die when its hot because then its open all the time.
You are adjusting the valves with the piston part way down the cylinder after TDC aren't you? That way you can be sure you aren't adjusting the valves with the tappets on the compression release tab and are definately on the base circle of the cam.
Do you know any history on the engine? I recall one several years ago that would run about a month and then get that 'when cranking it stalls on compression' problem. The third time it was in the shop I realized that: 1: I hadn't screwed up setting the valves. and 2: It had never had an oil change and running it that way they had worn through the hard surfacing on the cam. At that point, the customer was fed up and decided to replace the mower.
There was another that we took apart just to inspect the camshaft and the mechanical compression release was laying in the oil pan. The customer decided to junk that one too. I later put a used camshaft in it and my manager gave it to one of his sons.