Thanks for all the thoughts guys.
If it wasn't clear, the nut fell down the throttle body while the engine was off, so there was no damage. I just pulled the head and the nut was sitting on top of a piston.
This week, when I first pulled the rockers off to remove the head, I noticed that two of pivots on the rockers were upside down... the flat part was down on the stud, and the round part was up. I guess I installed them wrong after reinstalling the head. I feel really embarrassed to admit this.
Both the incorrectly installed rockers were on the exhaust valves of cylinders 2 and 4. At the time, I felt that might have made the rocker sit lower, so the valve wouldn't seat. I reinstalled the rockers properly, adjusted the valves, and did another compression test... still no compression. Is it possible that the incorrectly installed rockers wouldn't allow the exhaust valves to seat properly, and it burned them?
Charlie, I tried pouring water in all the exhaust ports. 2, 6 and 8 the water filled up the port. No water leaked past the valves. In 4, the water just runs out of the exhaust into the intake runner. All all 4 intake runners, the water just fills up, no leaks.
At this point, would it better to pull the valves or bolt the head back on with the old gasket and do a leakdown test? I don't own a valve compressor or leakdown tester, but will buy if needed.
Thanks for your help.