Hydrolock an engine, and now it knocks. I would be thinking bent rod. Something must give, as liquid can not compress. If that resulted in noise afterword, something is bent. I don't think the dizzy is an issue, worm gears are known to wear, so it very well could be that was bad long before this incident. Your noise is probably side to side movement, not up and down. Just curious if you have pulled individual spark wire wires while it is running? Removing the load may help isolate the location of the problem.
