If rotor turns then distributor is OK.
TFI system is most likely problem.
Have a read here on testing it:
http://www.therangerstation.com/tech_library/TFI_Diagnostic.shtml
The TFI module is often the cause of no start, but they will usually start showing signs of failure when heated up, i.e. you stop after driving for 10-15 minutes, and then engine won't restart right away, TFI module cools off a little and works again.
To time a distributor from scratch you need to find Top Dead Center for #1 piston on compression stroke, you do this by removing #1 spark plug and rotating the engine clockwise using a socket on the crankshaft bolt(removing all spark plugs makes this much much easier).
Use a pressure gauge on #1 spark plug hole or use your finger, rotate the crank until you see/feel pressure pushing out at the spark plug hole, this is the start of #1 compression stroke, continue to rotate crank until the timing mark on the pulley and Timing chain cover are lined up at 0deg.
Install distributor so rotor will line up with #1 spark plug wire on the cap.
Distributor shaft also powers the oil pump, so if distributor drops down but not flush against the block, then rotate crank 1/2 turn in either direction and back to TDC mark, distributor should have dropped down all the way now as it is now hooked into oil pump drive.
Then you need a timing light to set base spark timing, snug up the bolt holding distributor so it can't move easily, find the SPOUT Connector, usually on lower intake passenger side connected to distributor/TFI wiring, it is a plastic jumper, pull jumper out of connector.
Hook up timing light to #1 spark plug and battery
Start engine, loosen distributor bolt and move distributor to set base spark timing at 10-12deg Before TDC
Tighten distributor bolt, shut off engine
Reconnect SPOUT
You are done
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