Need PRO Advise
Yes, as you probably know, overheating can cause head gasket failure and warped heads. You did not mention the new motor running hot - only that they said you ran it hot. So, I am assuming that the engine did not, as far as you know, overheat. As far as you know, there was just a failure, correct?
You ask "is this from lower intake gasket failure?"
One would have to pull the intake manifold hardware and access the lower intake manifold gaskets to determine if they failed.
Yes, the early 4.2 motors were prone to "early" failure of the LIM gasket, but head gasket failure has never really been a big problem.
Based on the info you provide, and assuming you did not have the engine overheat, I'd guess you had a head gasket fail and that lead to the rest of your problems.
I suspect, if this is a Ford crate motor, that there is SOME way to determine its date of manufacture. Normal = sticker on valve cover and I think a metal tab under one of the head bolts. But, I'm guessing the valve covers are from your old motor so that might not be of much help.
Did the seller/installer provide a warranty? You don't mention it. If one was provided, then you'll have to look at the details there to see what gives.
Hope you get it all squared away.


