Hello Rini,
The engine can be turned carefully so as not to jamb the loose chain. Hold the chain up so it does not bunch up on the crankshaft sprocket if you turn the crankshaft. Remember, that the distributor and the injection pump can be wrongly off 180 degrees if you are not careful. Keep track that you do not set camshaft 180 degrees out when you re-install the head.
The max. wear limit of the cylinder walls is 0.10mm for gasoline engines.