I always set my MZ engines to a bit less around 2.7mm but best thing is to experiment and see what your engine likes. Anywhere between 2.5 and 3mm is likely to be ok. Set the points gap before doing the timing.
With coil ignition I have found you get a much more accurate result if you just turn the ignition on then slowly rotate the engine (plug out) with a spanner on the locking bolt. You will see the spark precisely as the points open. You will be surprised how far this differs from detecting the opening with Rizla.
Hope that helps