Oh my, oh my,,,. I've read this entire post and my jaw is on the ground. Rust particles on bearings, rusty piston, breaker bars and impact hammers, Oh my God... ! I'm not going to sleep well tonight just thinking about this.
Your situation is grim but if you somehow beat the odds with a successful startup, please bolt a plate of steel behind your drivers seat. All I can think of is a piston, possibly all 3 on the forward bank, flying thru the bulkhead into unchartered territory. This could be a very dangerous situation.
I know a person that put 3 bolts in an incorrect flywheel on a 67 GTO using an open end wrench. Same school of thought.
On the other hand I do admire your ambition and determination in wanting to get this job completed. I wish I could assist you or perhaps one of the other members could. Do be careful and good luck.
"Kilgore Trout once wrote a short story which was a dialogue between two pieces of yeast. They were discussing the possible purposes of life as they ate sugar and suffocated in their own excrement. Because of their limited intelligence, they never came close to guessing that they were making champagne." - Kurt Vonnegut