UPDATE:
This is unbelievable. The picture you guys saw showing that metal piece between the intake/exhaust valves, guess what? It was just a metal piece STUCK right there. Somehow that piece got sucked into the engine and stopped right there between the two valves. That was preventing them from closing properly and therefore the compression test was showing no compression on Cylinder #5.
We are doing a little more investigation but it seems like we are all good to go! Just a matter of getting new gaskets, etc and as we are at it, doing the water pump and IMS/RMS plus a new clutch that I already had in place.
It seems this was just bad luck that somehow something made its way through the K&N filter (the original air box/filter was removed by the first owner - GRRRR).
All this work opening the engine due to a stupid little metal piece! Crazy eh?
CR