I have worked on Detroits because I had to. We have had several in yard mules, fork lifts and compressors and still have one left. We call them dry because they do not have the require a seal at the bottom like a Cummins and they don't get pinholes in liners like cummins did in those days. I really doubt that the engine was run up to 4000 and I doubt that the tach even shows over 3000. We used to run our non FFC 350's up to 2600 on upshifts on upgrades. I would rather think that the engine was lugged. It was very important to have a pyrometer on those engines. The piston gets hot enough to expand and it sort of welds itself to the liner. Galling a piston or pulling a liner was quite common. I have seen exactly what you describe many times on engines without piston cooling. If it were my engine, I would scrap it and buy a big camIII engine of about 83 to 86 vintage. They have the piston cooling, the long head bolts, and if they have been overhauled, they probably have been machined for lower press fit liners. They are the toughest mechanical injected cummins we ever used and they fit without modifications.