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Chances of fuel contamination in the oil being the cause of his problem are tiny. I would get it set up if it has only been guessed, but I wouldn't consider it a probable cause of failure.
Petrol doesn't condense when it's mixed with oil anyway. It may failr to vapourise in cold bores and can condense further there, but once it's been churned around with oil and goes from sump to big ends, it won't condense into petrol again when it reaches bearings. Besides, if it thinned the oil out enough to cause this kind of damage, he would have had plenty of noise at idle and the oil light would have come on.
You can see that the problem wasn't a slow heating and it wasn't even rapidly increased wear, it was complete lack of lubrication and a very sudden failure. Your problem was either oil surge, a problem with the pickup or something that blocked the oilways. I'd put money on it. It could also have been some crap in the oil pressure relief valve, though that doesn't usually present itself at high revs, more when the revs drop afterwards, so you can probably rule that out too.
A very common cause is people using too much sealant during reassembly which ends up in the pickup. I presume you'd be more careful than that though so we can probably rule that out?
Otherwise, you've got a modified sump (with questionable baffling?) a modified pickup, a recent rebuild and some fairly hard acceleration....
You're right to fit an oil gauge and you're right to monitor the situation closely. You're also right to have the fuelling and timing set up. With that in mind, you can probably completely ignore all that I've written above.
Thanks for your thoughts.
Things have moved on today. I have finally found someone to make a decent exhaust manifold for it. £650 plus VAT - JP Exhausts in Macclesfield. Their work is mighty impressive so I have booked it in for mid June. It will be an equal length primary and secondary manifold with a 2.25 inch outlet.
Also spoke to a tuning guy local to me who is renowned for his work on carbs. He will set up the car, fuel and ignition for about £250 and will need the car for a whole day.
So plan now is to get the manifold sorted, change sump gasket which has a bad leak on it, change timing belt idler which is whinning, get the car set up and THEN put some miles on it
Hard on the wallet but these things need to be done right to make the car...