Fuel knock, nailing, and piston slap are not all the same thing. The info you got from the shop is essentially, "it could be any of a whole bunch of things, and we aren't going to waste our time diagnosing it for free." You have nothing new to work with.

Back in your post #66 you put up a snapshot showing what is labeled as the #2 pre-chamber. It looks fine. The ball is intact, and a clog at the bottom is a real long shot. If you got 290 lbs. coming out of it, then it isn't clogged! That's not your problem.

What you've shared already tells us that you have either a fuel delivery problem or a compression issue. You've eliminated the possibility of a bad injector, and it sounds like you've probably eliminated the possibility of a bad delivery valve. I don't think base fuel pressure is the issue. That leaves valves, rings, a broken piston (remember those chunks of iron in the oil pan?) or a faulty head or head gasket.

You didn't get a very good set of numbers on your first compression test. It is not unreasonable for your engine to run poorly if those were accurate readings. I suspect that they weren't. You should try it again. If you still see the same numbers on a second test, then the next step is going to be a leak-down test to see where the compression is going. Getting a diagnosis is a process. Unless you have much experience (which you obviously don't), or great luck, you can't skip steps. You just end up back at square one with no better idea of what the problem is than when you started.

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'79 240D