FYI, for anyone experiencing issues like this going forward here is what was found.

The regulator migh have initially been faulty causing an over fuel, but the new regulator was fine. We were able to start the engine using an external propane supply, then keep the engine running using the forklifts own fuel system.

The only possible items left were the carb and governor. We ended up finding that once warm, the engine start d easily every time. We took apart the carb, cleaned all the passages, cleaned the idle screw and seat, cleaned what I would describe as the "accelerator pump" mechanism, then reassembled. Cold the engine fired up if you depressed the throttle. Seems to run fine now. I believe the carb was just gummed up. Hope this helps someone else if they experience the same issue.