Fiber timing gear throws a tooth,the tapping the OP heard..then it get worse and sounds like a knock and the engine falls apart when the cam and crank get out of phase.The cam on these things can strike the crank if the valve times goes off..like when you install a cam and need to rotate the crank a bit to get the cam past the crank throws.
I vote 261. Replaced my 235 with 261, Captain bars above starter and on driver side below head, center top of block. But what ever it is, broke is broke.
I stand by my original asessment, yore moter is broke Though I'm over in middle Tennessee, I may have a line on a 292 with a PowerGlide attached out of a '65 1/2 ton. "It was running when parked." I do know it is complete, turns over, and can be bought complete with tranny for a $100 bill. I just called him to be sure he still has it and am waiting on his return call.
g-lover 51 i feel you pain!!! I just discovered that my 235 is completely seized, when the guy a brought it from said that it was running. When I took the valve cover off and saw all of that rust i knew i was in trouble. Let's be real...it is ridiculous how much it cost to rebuild a 235!! You can almost purchase a late model ls1 and the 4l60e transmission for what a machine shop wants to rebuild 1 of these things. Even the rebuild kits on Ebay are going for $1100 without any of the machine work cost!!! CRAZY
Sorry to hear about the damage. I have had some bad luck with rebuilt 235s. Trouble is, I rebuilt em all myself! I can't imagine having anything else under the hood though. They sure are sweet motors when they are running right. Good luck with your deployment and getting back on the road. TL.
So after looking and doing some serious thinking I bought another 235 for my 40. It wasn't my first choice, I was going to save up and get a 261 from Paul at Poverty Flats but this one was local and a little bit less money. So last weekend the tear down began. My 2 1/2 year old daughter wanted to pitch in as well. It turned out to be a great weekend.
Here are some more pics of the broken motor. And some of where I am at now. I am hoping to have it running in a week or two.