Re: Motor trash?
Ahhh, water in the cylinder from....blown head gasket? Ahh Haa, see i never saw any of that. Look if it ran with water in that cylinder it could have bent something underneath, a rod, tweaked a bearing, shoot I've seen rods just break. Crank can be tweaked? See, water don't compress. Whatever is tweaked is pushing the piston at an odd angle into the cylinder now creating a "water spot" as you say. If your starter can't push the motor at times, thats not good.
did you pull the pan and look up at the mains and rod of that cylinder?
Here's what i would do and I am no expert but have been into a an engine or two. Before you button it up for compression, get an inside micormeter and see if that cylinder is out of round especially at this "water spot" you speak of. Out greater than .003, rut rho shaggy! Stop and proceed to a machinist to discuss your options. those tolerances may be different for you motor but will be close. If okay, get compression, see what it is, 20PSI difference, proceed to machinist and discuss your options. If it isn't, crank it with the starter and check your oil pressure. if it's within specs, and the MOTOR DOESN"T BIND AGAIN!! Friggin crank it already. If it binds at all, Take it to a machinist.
Now this is what I would do! You already took the chance on your own that you could get this done and it's looking like it is too much. Your safest route is to take it to a honest professional and get it done right. there is nothing wrong with throwing in the towel. I've been there! You have a solid understanding and should be able to explain what's going on enough to get this thing fixed right. The chance you take with all this is that you frag the block when a rod breaks or spin a bearing. You have to ask yourself is the education worth it? I mean, maybe it is just rust? But we can't tell at this point through the computer. Get someone to touch it.
Good Luck JD