Oh it runs so badly, that you can not drive. So you did do compression testing while engine not at OP Temp and TB closed. Then 154PSI is not that bad.. With exception of #4 cyl.
Connecting Rods breaking in the USA made 4.7L 2UZ-fe engine, is not unheard of. But I've not heard of one case in a stock Japanese made 4.7L 2UZ of the 100 series, GX or 4runner.
I was unclear by your statements, if engine cranked over while testing #4 compression. If it did and compression gauge was threaded in and attached properly. My bet #4 has a bent valve. Very good chance this was the case.
Clues:
1 Barely running
2. #4 zero compression.
3. Timing belt looks new Toyota OEM.
4. Sold at auction. But great condition cosmetically and only mid mileage. Why go to auction!
Whereas the non VVT engine we've many accounts of engines not interfering (valve hitting piston) during a belt break. In the VVT it is generally believe they are interface engines.
Service History of vehicle at Toyota and Lexus (must call Lexus) and carfax, may tell a story. In service history drill into parts used.
If timing belt broke. Someone may have tried to see if engine was okay, by tossing on just a belt. Hard to see in picture, but water pump looks older than belt (belt looks brand new). In fact looks just like the rest of the aluminium parts around the water pump. But I need close ups to see better. By tossing on belt they could crank it over and see if any cylinder will not hold compression. It's easier to scope the engine, than put on a belt. But they may not have had a scope to look into engine. I've a $20 household drain scope I use.
It also possible belt was installed wrong. You did not show in pictures of belt, if timing marks line up? (cam sprockets to timing marks and crank to TDC mark.) Note: the "T"'s are not the timing marks.
If you've an air compressor. Hook it to cylinder #4 if it passes the screw driver test. Give it about 100 PSI. With all spark plugs out. Turn the crank 720 degrees, with a 22mm socket and long 1/2" ratchet or breaker bar.. If that cylinder can hold compression it will be very hard if not near impossible to turn the crank on compression stroke.
As you turn the crank, if cylinder holds some air pressure. As you come up on compression stroke, it becomes very hard to turn crank. So then reduce pressure from your air compressor to about 35PSI. Keep turning crank about 45 degrees more. This gets piston near top so pressure doesn't push it back down on you. Now listen for air escaping from intake valve or exhaust valve. Trick is you must be on compression stroke so all valves in #4 cylinder are or should be closed.
BTW: Someone has attached the ground wire on LH side of engine to the head cam cover bolt. This wire attaches to the engine hoisting hook. So why did they even have that off. Was it while head covers off to install new gasket and tube seals. Again clues are in service history
Good luck!
See my
Master thread, with index to many helpful links in my signture line. Look under "Engines" and in "The Unicorn" for helpful links