Pulled the Mess that was my Timing Chain....

Since the varnish on the lifters is so common, I suspect the chance of mushroomed lifters to be pretty much nil. They are well hardened so would not be prone to mushrooming any way. The cam won't pull out with any lifter nearly in place. They have to be up about 3/10's of an inch or more to clear all the lobes. If you got it that far forward, however, perhaps the cam journals jut dropped in-between bearings and it is not lined up to slip into the next set of cam bearings. That thing is LONG so you have to hold it perfectly straight and hold it up. Just don't be jerking on it or wallowing it around or the cam bearings will be damaged.

Pulling the engine at this point is not a bad idea at all. with all the trouble you are having. If the block is worn where the cam sprocket rides on it, then some serious block work is needed any way. If the lifters won't budge, then you are kinda stuck at that, and you can inspect a lot of other stuff. Kinda sucks to have to do that.....