"about a mm" is no way to measure deck height. clean up the pistons and deck and measure it at TDC with a dial gauge prefferably, or if you don't have access to one, with a straight edge and feeler gauges.

A compressed head gasket will be between .040" and .050" so it does allow you to run a positive deck height.

are there witness marks on the head and pistons - there would be if they were hitting each other. It would also have been pretty noisey.

its more likely to be detonation damage to the piston headland if its cracked above the top ring and taken a chunk out of the edge of the headland. are the compression rings broken too?