Old chain on new (or newish?) cogs is generally considered a no no. That chain looks old and worn. Did you measure it for wear? Is it too short? Top jockey wheels is getting a bit too close to the big cog IMO. Another link or two might fix that.
One of you brought up a good point about the old chain. The old or "as found" chain was silent when the small cog set was still in use. The noise started after I installed the 24 tooth freewheel. After that, I also installed a new eight speed chain but it made no difference.
I also swapped wheels and no difference. Finally, I installed another rebuilt freewheel and same problem. And, as mentioned earlier, I tried a different crank and ring set. No difference.
My biggest clue as to what is wrong is almost answered as I shift outwards, towards the drop. The further I get from the big cog, the smoother the chain gets, suggesting to me chain misalignment. The frame must be out of line between the drops and the bottom bracket. Best guess for now and that brings up tomorrow...
Tomorrow, if all goes well, I will set the frame up at a local bike shop and give it a good going through (great guys who always let me use their tools when in need - I do things for them also). Then, back to the cottage and assemble the Torpado. Well. now that I think of it, tomorrow is "dump day" and ya never know what happens on "dump day". And, on the way back from the city is pick up a six pack