Resolder that joint, very possibly it's cracked or a cold solder joint, causing an intermittent. And make sure it's not overly close fitting on the leads.
455kHz I.F. is for the AM Band.
10.7mHz is for FM Band.
Let's start over again. Your Post is somewhat analogous to driving to a Dealer and telling the service adviser "It's broke, fix it" and literally walking away. He has no information as to what it's doing and you end up paying thru the nose for days of diagnostics because they don't know what's wrong with it. The smoke in the IF area is not a cause, it's an effect of a different problem. Same thing with the 800c. Specifics help greatly and gets everyone basically on the same freeway, running in the same direction. As we Dig deeper, and get more details, the pack tightens up, and consensus builds.
Remember the 5W's from Elementary school english?
Who; 800c
What: smoke, low output from speakers (secondary right now)
Where: Near the AM IF Stack
When: While starting up unit on Variac
Why: ??
and finally HOW. Unknown but inspection with magnifier may sus out the problem.
Then we have the specific details?!
1.)When you powered up the 800c, what was the SOURCE SELECTOR set to??? AM? FM? Tape Head? Phono? AUX?
2.)Was the Tape Monitor Switch ON or OFF? If ON was a source connected and playing?
3.)Tone control positions?
4.)Loudness Button ON or OFF?
Don't think the specific details will help with the smoke problem. But they can help with diagnosis of the low output. The 800c is pushing 60 years old right now. It's still in original condition. You want it to run.
Do you: Go for total rebuild or just enough to get it running reliably? In the Long run a total rebuild is cheaper. One shot in a shop, and it's good for another 20-30 years (minus consumables ; i.e. Tubes). Or do just enough now to get it running pretty good. It may last or it may break down in 2 days, 2 weeks, 2 months or 5 years. And could conceivably cost 90% of a total rebuild in the 1st place. If you plan on keeping it for a long time, I would strongly suggest you do a complete rebuild.
Have you tested any of the tubes for weak or dead sections. Cleaned anything (pots, switches, tube sockets,etc)???.
Make yourself a DBT and get a 150W incandescent bulb. Until you get this receiver sorted out and fully functioning I would suggest using the DBT. Voltages WILL be lower (as expected.), but if a short occurs the bulb will absorb most of it as it lighting up bright.
In the meantime, list operating conditions at the time of the arcing and we can go from there.