Hi Les:
I assume you are using the circuit board / coil etc. supplied by Jerry Howell (et.al) for the ignition. It should be fine.
Be SURE you have the engine block connected to battery negative (called ground here)
Be SURE you have only one point of connection for all the negatives (grounds) i.e. bring everything DIRECTLY and separately back to the battery negative (coil neg, block, ignition module etc.). with their own separate wires.
It's likely that the sparks are not finding a quick connection to ground. The path is normally from the coil through the rotor to the spark plug wire and the spark plug to the block and back to the battery negative (ground).
Check to be SURE your distributor timing is right on. If the rotor is not pointing to a plug then the spark may try to find ground another way i.e. on a path through the distributor to the nearest ground which might be the negative lead of the hall sensor or any lead of the hall sensor and through the chip in the sensor.
AGAIN. Be sure the block (and therefore the distributor body) is connected to battery negative (ground).
Make SURE all your leads are as short as possible. Don't use a jumble of clip leads even for a temporary test.
All of above are a must and should solve your problem. I hate to recommend other sensors to mask the real problems (mentioned) but there are better hall sensors available that are more robust.
See the post here
http://www.homemodelenginemachinist.com/showthread.php?t=20415&page=18
Sage
V8 version of Jerry Howell V4
http://davesage.ca/