When i stripped its head, my 750 was off by one tooth of the cam chain sprocket. IIRC, the valves would have been too early.
Although i had never ridden it properly timed, it ran fine, I had other problems (leak) which prompted the strip down. There were no signs of valve contact with pistons.
The no clearance point, did you originally set valve clearances after setting the cam chain tension? No experience with 400s, but personally, with the valve cover on, because of the access angle, I find the 750 is a bit tricky getting feeler guages in and judging the level of play when you slide the feelers. Would be easy to misjudge.