Lost an inch??? where? of its length?

Lifters on a B20 are not adjustable - do you mean the rocker arms?
If you are having to make extreme valve lash adjustments it means that
lifters are going bad if the clearance is getting bigger, and that valve
seats are receding if the clearance is getting smaller.

If the nut came off the end of the cam you could get something similar to what
you mention with LOTS of noise. If you pull the gear and see threads on the
end of the camshaft that may be what happened, and you had better check the
soft plug at the back end of the cam bore. You have to pull the tranny,
bellhousing, clutch and flywheel to get to it. If you have a LOT of oil
dripping out the bellhousing that is one possible candidate (the other one
is the rear seal).

Further info and help available on seal updates on request.
--
George Downs, The "original" Walrus3, Bartlesville, Oklahoma