I couldn't get a .010" feeler gauge on any of them. Number one rocker was holding the valve off the seat.

Nurse it, & it will run for years. I've been driving a B20A on unleaded for several years & rarely adjust the valves. I drive it in a kind fashion mostly around town & it gets 24 Imp MPG with a sad slushbox. It's only when you're driving it hard up hills or cruising along at high speeds that valve seat erosion happens.

What valves & guides were you intending to use in your good head? I dumped my B18 heads about 2 decades ago because they really aren't worth buying parts for.

I adjusted them to .017" cold.

If it's a C, .022" minimum, .025" would be fine. Any other Volvo grind use at least .018" I know with the K cam that you can run them as wide as .025" because they are still on the clearance ramps there.

I have conflicting thoughts on whether I should spring for the extra C note for one of these gaskets.

An extra $100?!?, that's crazy. The stock Elring brand head gaskets are OK for anything this side of 170HP, I've even reused them in a pinch if it isn't too old!

I have never put a grinder to a head in my life.

You could do some work around the combustion chamber, but opinions are going to vary on what's right & wrong. The exhaust ports are another story.

What do you ultimately want to end up with? That determines what to do & how much to spend on a head & then the rest.