Just to be clear, I am talking about the gear mesh between the gear in the middle of the camshaft, and the distributor gear. Not the valve timing apparatus under the timing cover (yes, those are gears not a chain).
But I do agree with your theory of that much wear between (cam gear and dizzy gear) would seem more likely to produce a complete failure, not just slip a bit. Unless one or the other just lost a tooth or two.
