Welcome Jim J!
I have several issues with your story. As to the valve
train; Pulling the crank gear has
nothing to do with releasing pressure on the valves. IOW What ever position your cam was in when you pulled the crank gear, the cam is
still in that position, meaning; the same
valves are still open.
You've got the oil pan off. Can you
see anything out of place, or inconsistent on the crank? Loose rod cap, missing rod cap bolts, bent rods?
As to the valve cover being off; how do the valve stems look? Any bent, or rusty stems?
In the end; just a guess. But I'm inclined to think the timing gears weren't positioned correctly. They may have even been the wrong ones. Ultimately; it
seems like a valve colliding with the top of a piston. So (likely) valve timing. This doesn't rule out things like rust in the cylinder(s) causing a ring to seize part way through travel. But you'll at least want to be aware that because the timing gear is off your crank, you haven't released all the valves to their closed position(s).
HTH
Chris
