No start condition - 1988 90Q

[Radek]

In  need of help again, my son's 90q is out of commission again.
Here is what he reported:
when trying to start the car, at the first or second crank he heard a bang (a snap, something sounding mechanical) and smelled something weird under the hood.  The smell, he said, smelled of friction.
The car kept cranking, but no start.  Came back home on a flatbed.

Here is what I checked till now:
- starter cranks the engine
- timing belt is OK
- valve train is moving (took rocker cover off to see if sprocket is not sheared)
- has good compression
- timing belt alignment is OK (crankshaft to camshaft)
- distributor turns
- smells of gas when cranked
- seems to have spark (checked with wire touching enging block)
- coil resistance checks out OK
- Hall sensor works (blinks a diode)

Where to look next?  I'm going to blink out error codes tomorrow, mosquitoes chased us out tonight.
TIA

Radek