2000 S80 T6 Timing Setup Question

The Bosch water pump on my 2000 S80 T6 siezed up after 70,000 miles on the pump (175,000 miles on the engine). There were no cooling problems or leakage from the pump to warn me of this impending disaster. So, a word of warning- always change your water pump when you change the timing belt. The result was 6 bent exhaust valves and 6 bent intake valves- the pistons have valve marks on them but are ok. I removed the cylinder head myself (after receiving estimates of $4,000 to $5,000 to pull and rebuild the head). The head is now being rebuilt by a local machine shop.

My question about timing is this- My crankshaft has a flange on it with a raised rib. The rib is aligned with a tooth on the crankshaft timing belt pulley. Just above the crankshaft is a metal "U" protrusion with square corners. On the lower left leg of the U is another metal protrusion. From VADIS and other information I've gathered, the correct setup for timing the engine is to align the flange rib (and associated tooth) with the metal protrusion on the lower left leg of the U. With the crankshaft in this position and the camshaft sprocket timing marks aligned with their respective marks on the timing cover, the timing belt can be installed and the engine will be setup properly from a timing standpoint- as long as the variable valve timing unit is setup correctly.

I noticed last night that when the crankshaft is aligned as described above, the #1 piston is about half way up the #1 cylinder and not at top dead center- which is what I'm use to seeing based on past experience.

Can anyone tell me if this is normal for this engine? My engine number is 2544803 (past the engine number 1818169 when there was some type of change made by Volvo). Your help is greatly appreciated!!! I will have some nice PICS and what should be useful info. to post on this job when I finish.

Thanks- Matt.