Sadly, you're right... Except that _two_ cylinders failed the compression test. (We later determined it was probably the rings in those cylinders.)

:-(

At this point, I have neither the money (starving student) or the time (about to take my finals and then leave for an internship) to properly rebuild the engine so I'm parking it until later this year.

Thanks to everyone for their help and advice! It was a big help.