Not so. Closing the butterfly always allows less air flow through the carb and over the venturi tube and therefore pulls less fuel in. Air flow and fuel flow into the combustion chamber is regulated and controlled by the butterfly on the carb. More air = more fuel which = more volume of the air fuel mixture which = higher rpm
The O&R governor vein needs to be connected directly into the butterfly slot on the carb. As the governor's flag is pushed away from the flywheel by air flow, it closes the butterfly, the faster the rpm, the harder it pushes. The spring on the bottom side of the butterfly shaft regulates this tension and therefore "governs" the engine speed.
Post a close up picture of that area of your engine