Queen, you'll have to forgive me b/c most of my experience lies in pushrod gas auto motors, but for the most part the engines are a lot a like. So if I say something that's way off base, just ignore it.
The oil would've drained back into the pan in two days. Heck, most of it would've drained back in just two hours. So you can't tell if you have an oiling issue by checking that way. However, look for signs of overheating due to friction, blued steel on valve stem tips, excess wear on rocker hardware, etc.
Did the sound make a ticking noise, or did it sound like a deeper knocking noise. The ticking noise will sound like its coming from the head or valve cover, and that's a top end problem. Usually a lifter, pushrod, rocker arm, valve spring, or rocker stud. Worse case senerio in the top end would be wipping a lobe or damaging a valve (tip, stem, seat, etc).
The bottom end will sound like a jack hammer on the engine block if left for too long. If you threw a rod, there's no other sound like it. Bottom end stuff in a boat means yankin the engine, pulling the heads, and you might as well rebuild it if your that far already. Lets pray its top end.
Pull the valve covers again. Check to make sure all the studs, springs, pushrods and rockers are accounted for. Now double check your valve springs to make sure one isn't cracked on the back side way in the corner that's hard to get to. Wiggle the rocker arms, some will be a little loose, some will be tight, that's normal, if you can wiggle one off of the valve stem tip, then there's something wrong. Tripple check that assembley, spring, valve tip for wear, rocker arm for cracks, pushrod for straightness.
A compression test would also be helpfull, but I'd like to do a visual inspection first. If you're hanging a valve, it'll be obvious in the visual, compression tests take a little longer.
Not to insult your intelligence, honestly, but have your friend read this as well, if you or him don't fully understand all the terms and how to check these things, then I'd suggest finding someone who does know. Tell him you'll buy him 2 dinners at Outback to watch over your diagnoses and 2 more dinners to have him/her watch over your repair proceedure. Well worth the ~$120 in steak and beer.
DISCLAIMER: Yet again, take this with a grain of salt, as this advice applies to gasoline engines in cars and bikes.
Good luck to you, and enjoy learning more than you ever wanted to know about your boats darkest corners....
PS - If you do find something weird, barrow, buy, or rent a digital camera and take some pics to post up here. I'd really love to see them.