[Bruce Edwards]

Sounds like the bearing may not have been seated. It does sound like it is going to have to be taken out cleaned up and put back together. I am sure your lifters will be full of nice little metal bits and the pump my also be bad at this point due to sucking up the larger metal bits that got past the screen.
I am not sure I would hang on the that engine. May want to see if you can give it back and start over with something else. I would be a bit worried that the machine work may have more problems. It may cost you almost as much to have it all rechecked as it would for another engine but I am not sure what you have in it.
Sorry again for all the troulble you are having. always sucks when the toy is down.
My offer still stands if I can help let me know.