Hawk 250 New piston and rings

[Megadan]

There is definite cylinder scuffing going on, but what interests me more at this point is the oil and grime all over the top of the cylinder jug, and signs of oil seepage around the head gasket. Was all of that there when you first pulled the head after your first compression test, or is that oil from sticking the head back on and testing it again? If it was there from the start, I would almost wager the head got loose and the head gasket essentially failed.

I think at this point you might want to pull the jug and inspect the rings and piston. Since you have come this far, it's not much more work to get the jug off.