John,
I didn't get a chance to start the 55 today, so wasn't able to confirm startability on a warm engine.  If I understand your description correctly, then "valve recession" is the amount the valve is recessed into the head, which I am assuming is a result of wear on the valve and/or valve seat.  I would suspect that the cure would be a valve job with new seats?  I am wondering if I can take up some of the wear by readjusting the valves, as long as the valve is still making a reasonably good seal?

I haven't taken anything apart yet.  I need to find a 1" fitting so that I can do a compression check, and start testing for the source of compression leakage with compressed air.  

The manual states that I should have a 15.5:1 compression ratio, but does not state what the compression should be in lbs.  About how much compression should I have on this diesel engine?  180? 200? 220?  Just wondering if my guage goes high enough. Thanks for the help.

Dale