I could not check the bearings after the crash as I do not have the tools required to completely disassemble the engine and put it back together.
Didn't you have the piston out of it? Most engines of that type will cough up a crank if you just lightly tap it out (but -- I don't have a Jett-anything so I may have my head someplace dark and warm).
It is possible that one or both bearings have some internal damage to the rings or/and the balls retainers (baskets) as there is a very weak clicking sound coming from inside but only from time to time. This sound is very weak and there is no resistance associated with it.
If you can get it down to the point where the piston is out (which you have) you should be able to do a quick functional test -- spin the crank, and feel to see if it turns smoothly. If it feels like there's gravel in there, or if it wants go to some preferred position, then the balls or races are damaged. If the bearings are
the culprit, the nose of the engine would be getting hot-hot-hot.
There is also a little play ( ~0.03") on the shaft along its axis. Simply: when the shaft is pulled and pushed, the end moves ~0.03" back and forth. This play is not present when the propeller is installed - only when the shaft threaded end is held by fingers and pushed or pulled.
This sounds normal to me for this general kind of engine, but I've never had a Jett, so...
Question: how hard can I torque the head mounting screws in order not to damage the Aluminum cast cylinder? I wonder if the RPM problems are not caused by the fuel leak between the button and liner. I cannot see anything leaking there when the engine is running but perhaps the shim was not squeezed enough?
Oh noooooo! I couldn't give you a torque number, but if you reef on the bolts at all then you'll warp something. If the thing won't seal correctly with the screws put in so they're just barely tight, then reefing down on them won't make it seal. With metal to metal seals like this you're more likely to make them leak by over-tightening than by under-tightening.
You're clearly approaching this with the attitude of wanting to fix the engine yourself, so forgive me if I step on your toes here -- should you be considering sending it to Randy, or to some guy who's last name is Jett? It may cost you a few bucks, but you'd get back a known-good engine, or a good story on why it's not worth it to pursue the matter.