Hey everyone, new member here! I was hoping to get some advice from the community.

I recently purchased a '98 4Runner as a semi project vehicle with the understanding that the engine was in good condition. However, after driving for a bit, I noticed a lack of power and rough idle. After performing a compression test I quickly determined that one of the cylinders had low compression (>20 PSI lower than the rest). After putting some oil in the cylinder, it raised significantly. So in the spirit of getting exposure to my first engine teardown, I removed the engine and tore it down.

My rookie mistake is that I did not mark which cylinder had the low pressure. I assumed it would be obvious, but it wasn't. While tearing down, I noticed that everything looked in great condition, from cams, to bearings, gaskets, pistons, rings and walls. I was actually surprised, however discouraged that nothing obvious stood out to me.

While looking closer I noticed a mark on one of the cylinder walls (Pictured below) that may have been from a previous repair, but not sure. I had expected to see the cross hatching over this spot even if a prior repair, and my assumption was that this might be a low spot and could be the source of my low compression. It feels smooth when rubbing my finger/nail over it, but I realize that's not the most reliable test.

Any input would be greatly appreciated!

 

At first I thought you meant the wear ring at the top of the bore, that's common on higher mileage motors. But then that 3rd picture... Def looks like someone welded up a crack and re-honed it.

Which is usually not a repair I'd expect to see unless it was some very rare antique engine block. Normally, in the case of a cracked bore like that, chuck it in the recycle pile and get another one since they're (relatively) cheap and easily available.

 

Hard to imagine what damage would have required that kind of repair. Cast iron or aluminum may crack, but steel sleeves? More like some marring was filled in from a broken ring/land. Would have been good to do more diagnostics before tearing into it, like look for bubbles in the radiator or better use a sniffer to check for compression gasses in the coolant.
Can you see anything looking into the water jacket just opposite this spot? A fiber optic inspection camera or ear camera would do. A crack repair would probably leave a bead or bridge inside the water jacket, possibly blocking proper cooling. If not maybe use some ID measuring tools to check for roundness, low spots. Use some bluing and rehone that bore to see if it blends well. That spot has no crosshatching as if it stuck out a bit and wore first. You will want to protect/pull the crank and clean the block well after any machining.