Originally it had a 307, and everyone where I lived told me that motor was junk, too. It only lasted 37 years, what a piece of crap.
Anyway, after I get home from school I guess I'll have to take it back apart and see what the noise is. It sounds like it's coming from the bottom end, but I can't be certain. Also, I noticed one of the pushrods (#7 intake) doesn't come up as high as the others. Is this most likely a collapsed lifter??