I'm not going to go as far as saying what your readings show is wrong, but being a mechanic by trade I'd say they are questionable at best. If the engine was running at all then at least one cylinder had to have enough compression to do so. In other words 15 psi isn't enough to run, and 0 psi definately won't fire at all. That said Onans have a reputation for running when you think they would never be able to run. Over the years I've seen two cylinder Onans running on one cylinder with the other rod hanging out of the block, with the cam broken in half, with no plug in the other side, etc, etc, etc. Funny thing is when doing this they seemed to be perfectly good one cylinder engines and simply didn't have the same power they did when running on two cylinders.
Now, some Onans had a compression release that would keep the valves open to help the engine spin faster when starting, and as such, act as a starting aid. Basically the faster it got up to speed the easier it would start. Often that device will cause faulty compression readings if the engine isn't spun fast enough when checking it. This could very well explain the reading you got of 15 psi on the one cylinder. The only way to get a true compression reading is to have the engine running, if at all possible. Unfortunately on a two cylinder engine this is all but impossible to do so your kind of stuck with what you've got in that case.
As far as the problem your seeing when running it sounds to me like you've got one good cylinder and a burned valve on the other. With the burned valve not seating properly it would cause the reading your getting of zero when just spinning the engine over, compression release or not. Now, when the engine is running on the good cylinder, the bad cylinder is moving fast enough that it could/would be sucking in and compressing the air fast enough to partially overcome the amount of 'air' being let out by the valve not sealing. As a result the cylinder would be firing and as as it fired it would be sending hot, still burning exhaust gas right out past the valve. This would cause the flames and red hot muffler your seeing on the one side.
In the end I'd do like the others have suggested and at least check the valve clearances before going any further. If needed pull the head and check for a burned valve before tearing into the engine even further. If the seat isn't hurt you can get a new valve and just lap it in, but if the seat is burned also then you'll need to pull and disassemble the engine to have a replacement seat installed. Good luck.
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