im running a B16 SIRII in a 96 honda civic

When i bought the car it had a CEL problem that stayed on until i poped out the fuse or disconnected the battery.. and the code ran 1259 which said it was a V-tec malfunction, i took the v-tec apart and cleaned it.
Well now im getting another one that i can reset by just turning the key off in the car, with the CEL the v-tec doesn't kick in and redlines out at roughly 6500rpms.. when i reset the light the v-tec comes on. I've tried hooking the obd reader up to it and it still comes up with the 1259 but i don't understand why i can reset the light when i turn off the key, when i use to have to pull the fuse or disconnect the battery.

A few people have told me the O2 sensor could be bad, cause i do get a rich gas smell, rough idle at stop lights and every once in awhile it almost dies starting off from the light, and i don't get that great of gas mileage..

any ideas of what might be happening?