Timing or there lack off
 

My 81ZX is not feeling very good. Everytime I start her I have to re-adjust the timing. She feels like she is running on only 4 cylinders. I checked the sprked at all plugs, it is very strong. When I pulled the cap off it looks like the rotor is grinding on the inside contacts on the cap. Also when the motor is running and I go to adjust the timing I can fell grinding coming from the distributor. Is my Dist. hosed or am I missing something?
Any help would be great.