Harald...the question still hasn't been answered on what year the car is. 2.2 can adjust base timing. Given the 12* spec, I'm under the ASSumption this is an LH2.2 car.
OP...4* retarded will absolutely make it more of a dog out of the hole, should hit nice around 4k. For now run it around 4* advanced, works reasonably well with the auto trans. As mentioned, it won't have the torque the T cam had, but it shouldn't be a dog either.
Erik brings up a good point on making sure the kickdown cable is adjusted correctly as well. While that won't make your power out of the hole night and day better, it may help get the power to the ground.
I'm with Harald as well, check your cam timing against the washer under the timing cover, make sure it's all lined up right. Being a 740, if the cam timing is off, that also changes your spark timing, so every time you change your cam timing, you'll need to reset your ignition timing as well.