Muffler?

[art leong]

We used a 3" Summit Racing muffler to chassis dyno the car this weekend. The reason for the muffler was to get a better wide band O2 reading at lower rpms, the O2 sensor is in the collector about 8" from the end. So it doesn't read well below 4500 or so.
This is a chambered muffler not a straight thru design.
We have a loss of HP and torque starting at 7100 rpms. and continuing downward at about a 45 degree angle.
We adjusted timing and fuel mixture. Was able to take power away but not add any.
This happened at the same rpms using 2 different intake manifold setups and tunes.
Thought it could be my hydraulic lash adjusters pumping up. But the cam manufacturer says that if that were the problem the car would misfire when backing off the throttle.
Noticed that when we first dynoed the car (inexperienced operator) a year ago there seems to be the same problem. But due to the circumstances never paid any attention to the sheets.
The first motor I built (less compression, less cam) made increasing power to 8100.
Other than cam and compression the only big difference was the first motor had an pretty intricate crank scraper. While the new one only has a windage tray.
Try to narrow down ideas.
Thanks.