Finally some pictures of my nightmare

Sorry for killing the board with my insanely huge photos....

My bad big time :oops:

Well, without being able to inspect the whole engine it's going to be hard to determine what the cause was, and more importantly how to not do it again.

However, my guess would be that the cam and lifters weren't properly broken in. This caused a lot of cast iron particles to go through the oiling system ruining the bearings, and I'm sure there are more. The pistons and cylinder walls are probably unscathed but the cam bearings as well as the rod bearings are probably ruined as well.

You should do a full rebuild and clean, clean, clean, clean that block and the oil passages extremely well.