I never had any luck adjusting the valves on a running engine. The oil isn't the issue. Even with that nice Snap On tool, which I have, you need at lest three hands to make the adjustment and hold the feeler gauge. Also, by the time you're done, your feeler gauge is done, too. The rocker arms will chew the blades up against the valve stem, rendering the gauge inaccurate, in my opinion.
The OP probably had hydraulic lifters, which wouldn't be adjusted with the engine running anyway. 29tons, are you sure the block is drilled for hydraulic lifters? Even though it came from a Powerglide car, doesn't mean that is where it started its life. You can't run hydraulic lifters in a solid lifter block, because there are no oil passages for oil to the lifters.
