LA360 initial timing too high - are there different timing covers?

Good on the TDC mark... sure looks pretty close. Your screwdriver-on-the-piston feel is better than average!

Ummmmm...... when the damper is at 0 and the engine is at TDC, there are 2 cylinders at TDC: #1 and #6. One will be at the top of the compression stroke and the other will be at the top of the exhaust stroke. So if you tested the wrong one (the one at the top of the exhaust stroke), then naturally the exhaust valve will be open, and will close if you rotate the crank to so many degrees after TDC. (Which sounds like it is what you found..... so are you testing the wrong cylinder?)

Did you look at the rotor positions and then the cap position to see if the rotor was pointing almost directly at one of the cap's spark towers? (I.e., rotor phasing correct?) And then trace from that spark tower to see if that spark wire was going to #1 or #6, and test on that cylinder?