[torqhead]

Catching up... the pickup tube on the oil pump.

I would think on the dyno it probably starved it of oil at the upper RPM range during test. What that does in more of a layman's term is it doesn't feed enough oil through the engine and effectively parts like the crankshaft to the bearings start to heat up and eventually they can damage the parts real bad or cease and "weld" them together for lack of better way to describe it.

My assumption is during the first dyno test, at idle and a bit above idle there probably was oil pressure and no issues on the dyno. The pump is actually submerged in the oil low enough in the oil pan that it shouldn't have had a problem picking up oil. But when the motor was tested and ran up to 5000 RPM or so I'm sure you're getting down to the amount of oil flowing in the engine it may have caused the oil pump to suck in some air. They probably saw the oil pressure drop and hence why they knew what happened and opened it up and said more than a few cuss words. If all of that is the case, it's an awsh!t moment and someone had a bad day! Good thing it was found there!

As said before, just hoping to shed some light on what may have happened but I sure hope the problem can be found before doing any further damage.