So I completed the rebuild of my 360FE into a 390FE with the help of a knowledgeable engine builder (chevy guy). We got it into the truck and fired it up and proceeded to break-in the CAM at 2000 RPM as specified. It ran smooth and quiet for the first 4 or 5 minutes. Then a slight ticking sound started which quickly became a lound knocking sound. We knew something was wrong and shut it down. Only got about 6 minutes on it and spent several hours of diagnosis and determined that something was making metal chunks so the engine had to come back out.
Turns out that the original mechanic that I paid to fix the timing problem had removed the nylon gears and then inserted the metal spacer that mounts behind the nylon gear along with the new steel gear on the camshaft. We found it just like that so we assumed thats how it was supposed to be and assembled it the same way. Now we have learned that the steel gears have the spacer cast into the part, so with the additional spacer the camshaft had about 3/16"-1/4" of endplay to slide around in. The spacer determines the endplay of the camshaft so with double spacers the cam moves all around. Some of the lobes got half-engaged on the lifters, others dug into the lobe next door. Some lifters dug into the cam bearing surfaces. The timing was jumpy and if we had gone on with the break-in I'm sure the distributor gear would have sheared just like before.
Lessons learned:
#1 Always check your camshaft end play.
#2 On Ford FE engines, don't use any spacer between the cam and the timing gear if it's already built in!
Now I am rebuilding it again... All the metal chunks damaged lots of stuff: New pistons, rings, bearings, oil pump, oil pump pickup, cam, lifters, cam bearings, and some machine work.
