It worse than I thought, Jon.
Having another poke around in the cylinder revealed that it isn't just a radial groove round the outside of the plug --- it's has a radius round the end of the plug the same as the radius on the front of the piston.
Then there's a radial groove behind that section.
By a quick calculation :-
The transfer port has a volume of 0.078cc
The plug radius has a volume of 0.176cc
So the total lost volume is 0.078 + 0.176 = 0.254cc
The swept volume of the cylinder is 43.12cc
So the static compression ratio is 43.12 /0.254 = 170:1
That figure doesn't include the full radial groove behind the radius or the hemispherical cutout in the front of the plug, so I reckon the static compression ratio is nearer to 100:1 --- no wonder it was getting slammy.
It's an absolute knacker, but I'll give it some thought.
All the best Mick