I think there is a correlation between the "odd" engine sounds, the decreased compression (on that one hole....provided your measurement/test was accurate), and the sheared crank notch. To me...it is rather glaring.
No, I'd say you made contact with the valve.You really can't have the crank sprocket down there dancing to it's own "beat." You may well have two problems going on.This is a hyd. lifter engine and could well be a "chicken and egg" scenario: crank sprocket tab failure and then timing problem....or hyd. lifter seizes and leaves a valve somewhat open and works on the sprocket through the belt. Granted you have 400 lbs in that hole. But, it is off from the rest......based upon your numbers.Myself, I only run one hyd. engine anymore. And, I would like to get away form that one. Food for thought.Did you make ANY attempt to "launder" the oil cooler (which I ALSO do NOT run) prior to installation?