You could have a one or more valves stuck, if that is the case the affected pushrods may bend. If you have a valve stuck closed it will effect compression and intake and expelling of fuel air mix. Since the motor is turning it is unlikely you have a stuck cylinder as that would lock everything. By cranking motor I do mean have someone turning motor with starter and electric on to ignition system.
You say you have fire with spark plug removed from hole and grounded against block can you see a spark jump the gap when cranking?Alternate method is to stick your finger in spark plug wire boot against the metal have someone crank with intuition on if it bites you have fire, I personally don't like this as well as I did when I was twelve. Since you are cranking without it starting you should see some evidence or smell of gas if you remove spark plug and sniff it. Is your battery in good shape and able to hold a charge?
To determine if you have a stuck valve you can remove rocker arm cover and crank engine by hand or starter as engine cranks you should see some movement from all valves this does entail some risk as you could further bend pushrods but likely if they are going to bend they would have already done so. A safer though somewhat more complicated way would be to remove rocker arm assembly and individually tap on each valve stem to see if they move.
Stuck valves can cause backfire thru carburetor as well.

Last edited by kb3csw; 05/06/2011 1:18 PM.