It is beginning to sound promising and the link to the workshop manual is a must for you to have so hopefully you have this one too.
Glorts initial reply was correct add a bit of water and your reply that can be scarey was correct but it was clarified by Stef the safe way to do that and it is one step I certainly would try especially after that extra information about sparks (hot coke) coming out the exhaust, this is most likely the big issue.
With your fuel system, completely drain every drop out and add some fresh diesel from the fuel bowser of some quality not some fish n chip grade stuff. If you intend to pull the injectors then pull both and while they are out is a good time to replace all of the fuel in the system and fuel filter as it is easier to turn the engine over with them out then in. The system will bleed quicker and once it is at the injector you will then hopefully see a lovely super fine spray. If this is the case simply wipe them over and replace. Not sure if there is a copper seal under the injectors but check this with the manual. If there is find the old ones as they maybe still down the hole and replace them. If no new ones are available carefully remove them and heat them with a LPG flame and allow them to cool naturally. This will soften or anneal them and help make a good seal again.
Each day I read here there are extra bits of info being put forward to help you out and it is all good and sounds like there maybe big positive progress soon. Keep us informed.
Is was the same manual I had found on another place a great help to have as it gives so much information if only the things you bought today had the same and not a slip of paper badly translated from Chinese, but then will any of them be around in fifty years time ? will they still work in 50 weeks?
But back to the engine, I think with all the help I have been given we have come a long way to working out what the problems might be, I thought I know a bit about engines, I had never can across engines being cleaned out with water but looking at the manual the pistons have a recess in the top of them, this most likely is full of carbon, which will change the compression and also mess up the flow inside cylinders, I am working this week but hope to find a bit of time to get the filters on order so I can have a go in the new year, I will let you know how I get on
Ian