Pesd,
I dont get on here as much as I used to but I did read the entire thread. Did you hear me yelling, ITS NOT THE RINGS!š (about your compression check. Plugs out, throttle wide open, 5 to 6 'hits' that's the compression you hear of the one cylinder you have the tester in, I suspect it will be much higher if you did it this way).
On your turbo rebuild/upgrade, there are lots of compressor wheels(cold side) available. Stock is approximately a '12T' 14T us a great upgrade and in fact, if your housing has damage, it's a good way to fix it by having it made larger for the 14T. 16T is great for a modified 16V motor but I dont reccomend it for a stock motor. Unfortunately the turbine wheel (hot side) is the largest wheel made for the IHI RBH5 family of turbos.
One last thought, when your brother said valve seals, he was likely right. Even tho only 14K on the motor they are 30+ years old and as mentioned earlier in the thread, valves themselves and guides were not of very good quality.
I'd say just do the turbo rebuild for now (14Tš) uncork the exhaust and crank the boost to 13.5.
AJ