360 Timing Mystery

the crank timing key should be at 2 o'clock when at true tdc.
Yes, this is the first thing I see... the engine/crank is not at TDC for #1. Key shold be around 1:30.... The crank sprocket's timing dot position relative to the sprocket key looks correct. (I have not dragged one out to be sure it is exactly on.)

BTW that chain looks to have a bit of slack in it....