Fuel overflowing could be caused by a small piece of dirt under the float needle. I have had them overflow on me, and it was because of a small chunk of rubber coming off a new fuel line I installed. If you are careful and have a magnetic screwdriver, you can pull the top off the carb while it's still on the engine and have a look.
Sounds like your engine is still original, but messed with. The 2.8 was originally computer controlled, which is why you have all those wires and the TFI distributor. There is a special procedure to set the timing. If you do not follow this, the timing could be retarded and give you a stalling, no power problem. If you really want to straighten this thing out and get it running good, you need to go buy a rebuilt distributor for a 79 pinto or mustang with a 2.8, and install a duraspark II module or a HEI module to go along with it. You will not believe the difference it makes in how it runs.
The 2.8 is just like the 80's 300 six in the big trucks. Ford put a computer controlled carb system on it, and that is ok as long as everything works. When something goes wrong, it can ruin a otherwise good engine. You first have to do a lot of studying to figure out how it all works, and then you have to be a detective and find all the parts to work on it, some are not available new anymore. I took the path of least resistance, and converted mine to a conventional ignition system.