95.5 3.2 4wd knock/timing? issues

hello all,
i'm new to this forum,and wondering if you guys could give me some advice.
i just purchased a 95.5 rodeo with 3.2sohc and 4wd for $500(immaculate inside and out).it has 95,000 miles,bought the vehicle not running.i was told the vehicle had been overheating and had developed a knock,but it still ran.there was no smoke coming from the exhaust,but there is a coolant leak.it sat for 8 months undriven and i cannot get it to start.it turns over fine and sounds smooth as silk,(every 5 or so revolutions i can hear a dull,quiet "thud" noise),but no fire.i took the front of the engine apart to check the timing belt,still attached,however i noticed an accumulation of rubber "dust" on the inside of the upper timing covers.
there is an accumulation of oil in the #3 spark plug well(enough to see an oil stain on the top of the valve cover).there is no sign of coolant in the oil(kinda dirty though).
just wondering how succeptible these engines are to damage from overheating and if any of you may have encountered the same issues as i.
any help would be greatly appreciated.
thanks,
sean

For the knock, have someone crank the engine over while you look at the timing belt. Any slop means the t-belt tensioner is bad. That usually gives the knock noise. Oil in the plug wells is super common and harmless. For coolant leaks, check the pipes under the intake that feed the backs of the cylinder heads. Check superfletch's thread on that:http://www.automotiveforums.com/vbulletin/showthread.php?t=471459 A common source of overheating is rodeos is a plugged/old/worn radiator. Do an ATF change as well if she ran hot!

G/luck
Joel

i'm thinking it may have been the water pump that went,i can't find any coolant sitting on the top of the engine.when i add coolant it seems to be dripping off the oil pan,but i'm still not sure at this point.

so i got a little farther into the engine.i ran a compression test
right bank:
#1-0
#3-28
#5-28
left bank:
#2-30
#4-50
#6-50
there was also some water sitting on the bottom of the oil pan(it had been sitting for nearly a year.
i put a dowel into cylinder 1 and cranked the engine,and the piston is moving.
kinda stumped.
there is also nearly 1/2" of play in the timing belt between the right cam and tensioner.