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At TDC, when piston 1 is entering it's power stroke, the intake cam lobes will be just past their point of operating the valves, and the exhaust cam lobes will be past the top and moving into position to start to operate the valves for exhaust. Set them up with the bar so that you can see this configuration... remember the cams rotate at half the speed of the crank.
 
Any molybdenum-disulfide grease. Might be simply called "cam lube", "break-in grease", or "moly lube".
 
Yeah, don't coat the journals with grease, and if the cams are used (broke-in), you don't need the grease for the lobes either... just oil them good.
 
A stock Zetec is a non-interference motor, unless the head you have was shaved allot, you didn't hit anything.
 
I know there was a "debate" on some thread about how non-interference the motor actually was. I had the service tech at the dealership tell me the same thing, but I'd rather ere on the side of caution. It's a FR head and it hasn't had any work done to it.
I don't know where my head was at with the former comment... I wasn't taking into account the lift on your non-stock cams...:what:

But like illinipo pointed out, certain bad-enough bends would show up in gap expansion (all would change gap, but the slight ones would be hard to gauge).
 
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