I've been through the 126 and 124 FSMs every which way and I haven't seen a section on fitting the chain over all three sprockets.

Did you check the valves prior to this point? There's a hair's width of a gap between the pistons and valve faces. I wouldn't put money on the valves being okay if the chain broke with the engine running.

Until a better answer comes along, use a dial gauge on the #1 piston to establish TDC then fit the chain with the cam at TDC and the IP wherever it is. Or maybe you have the IP timer holder special tool. Set IP timing when the long block is together.

If the head is already on the block, trial fit the front cover and damper pulley to establish TDC using the timer indicator tab then don't move the crank as you fit the chain. Better still, pull the #1 prechamber and use a dial gauge to find TDC.

I'm pretty sure the crank woodruff key is straight up at TDC but get a couple more opinions on this. IMO, this is an inaccurate indication of absolute TDC.

Pressurize the tensioner plunger and put the tensioner in place before you turn the engine even just to confirm timing.

Good luck!

Sixto
87 300D