Joined: Nov 2016
Dvelek, sounds like your engine has experienced catastrophic failure, probably because you were running about 18 degrees too much timing. That would cause massive problems with detonation and high cylinder temps while at cruise, even on premium gas. I would not be surprised to discover that your ring lands are shattered, or that you have holes in your pistons.
I would not spin the engine any more, for any reason, since you know it failed one compression test. It is possible that your block is salvageable now with an overbore, even if there are damaged pistons and rings. But if you try to start it, or keep dragging metal chunks up and down the cylinder walls, you are just going to create more damage.
My recommendation is to rebuild your current engine, or replace it. If originality is not important to you, you might consider a modern 5.0 HO roller cam engine from an '88+ Mustang, or a '98-01 Exploder/Mountaineer. All of your 289 accessories (like intake, timing cover, oil pan and pump) should bolt right up.
Sorry to hear about your trouble!
I smile a lot. It makes people wonder what I'm up to...