Those seals were damaged by the tool used to compress the valve spring during assembly. Someone didn't set the full-stroke distance correctly and it squashed the seals as the springs were compressed.
You can change the seals with a tool used to compress the valve springs with the head installed. Lisle, K-D, and several other tool manufacturers sell that one, and they are always on Ebay. You'll need to pack about 10 feet of 1/4" nylon rope into the cylinder through the spark plug hole and turn the crankshaft tight against the rope to keep the valves from falling down into the cylinder.
DO NOT use the small O ring seals under the split locks if you choose to reinstall the positive stem seals. Using both the OEM seals and the positive seals will starve the valve guides for lubrication. Some people even remove the sheet metal shrouds at the top of the valve springs when using positive stem seals.
Jerry
