Can a small block timing chain jump a tooth?

ChrisRom said
The mystery deepens... just open the timing cover and everything looks good there. No sloppy chain, the motor is in timing.
Next suspects are the teeth on the camshaft or the distributor shaft.

Did you see if the balancer has slipped? #1 piston to TDC and check it against the balancer. There's a good chance the balancer is original.