timing vs. compresion

Shims are generally used to raise the exhaust port, which changes the timing, but the primary reason is to eliminate sub piston induction (SPI), so you can use a muffler or an exhaust restrictive throttle. There's no reason to shim an engine that doesn't have one of those, as it will reduce performance. SPI combined with mufflers work poorly together. If you can look into the exhaust port and see a gap under the piston at TDC, you have SPI. If you wanted to muffle that engine, you would add enough shims to close that gap.

Adding and removing copper head shims(washers/gaskets) is to adjust compression. With a standard head, generally use one washer for every 10% of nitromethane in the fuel. Using too few will blow the glow element. I use two shims with my 24% fuel and 3 with my 35% fuel. I also have killed a couple of glow plugs lately, so you may want to be safer and start with more. Other than that add some and remove some to see where the engine is happiest.

I don't have as much experience with high compression heads like for the Tee Dee and Killer Bee, but I stick to the same rule of thumb. I accidentally ran a high comp head with only one washer last night on a Black Widow and the glowplug was blown after the run. Higher compression on most Reedies makes them more difficult to needle, and I've found it's not usually worth the trouble. Rotary valve engines like Tee Dee and Medallion work nicely with High comp heads.