Loosing power could have been a seizure.
These SOHCs can have an odd tendency for lifters to clack.
My Mighty max can not be driven down a 3 mile hill without sounding like it is going to throw a rod. Similar if I park on a hill, when I fire up the lifters have collapsed, clack real bad for 10 minutes. It has pressure according to the factory gauge but I would swear it doesn't from the sounds it makes. But I get no issues with the heat from towing.
I have heard about this from the dealer also.
I do not get these issues with my DOHC engines. Odd in my mind.
You assembly lube may dissolve into the oil, it should not have been an issue. Using grease is the issue. I just use oil in the pump.
100 psi is not an issue, 150+ is. My 4G63s run over 100 psi every day and my 72 Colt pegs an 80# gauge whenever it is cold. I have seen warm 4G63 without balance shafts over 100 psi especially if they have 20W-50 in them.

Is there any chance of a tight ring end gap? That can make big heat quickly.
Do you have an infrared thermometer?