HowdyBack Tim:
Your '68 distributor has a vacuum advance/retard cannister. The inboard nipple is the vacuum retard function. The outboard one is the vacuum advance function. It goes to a ported vacuum source on the carb.
Your '68 distributor is NOT a Load-a-matic. It has both vacuum and centrifugal advance. This was the Calif E/M system begining in '66 in California, and became the standard for all states in '68.
The heartache is that the '68 Autolite 1100, with NO SCV and a ported vacuum source, was downsized to a 1.10" venturi from the previous 1.20" for a 200. That's a loss of 35 cfm and that hurts a bunch.
Yes, you can use it like that, but the vacuum advance cannister functions more freely if you leave the inboard, vacuum retard nipple unplugged. If it is plugged, it creates a vacuum lock the other side has to work against.
The vacuum advance rate and amount can be adjusted too, on these distributors. Note the nut on the outboard side of the cannister. Under it you will find a few washers and a spring. More washers adds more resistance to the spring and delays and slows vacuum advance, fewer washers quickens both the point and pace of the vacuum advance rate.
Adios, David