no that definitely sounds like timing chain, im willing to bet on it, toys are known 4 this

I will have to agree..the more he posts the more it sound like a bad chain tensioner or broken guide..

Makhon,,you said the motor was a recent rebuild?Do you have any idea the brand or mfg of the timing set and guides?
Pop off the valve cover,,see the guide,,is it missing?do you know what I'm talking about?
You should be able to look down in there with a flash light..chances are if the tensioner is bad it caused the chain to get loose,,in turn allowing the chain to slap and bust the guide..while the valve cover is off and the motor a little warm re check your valves..