UPDATE:
I replaced the Cam adjuster pads last weekend and while I expected to find lots of wear and other not-so-good things like chain scrape on the VC as well as deeply grooved and/or broken pad pieces, I was pleasantly surprised at what I found, or didn't find.
As you can see, the only real damage was a couple of very small pits in the pads. Don't mind the broken pieces, I broke the lower pad while prying them from the adjuster (CCT). It was definitely brittle because I didn't apply much pressure with a screwdriver when removing them. I guess after 17 years and 250,000Km, it's to be expected from plastic.
No chain marks

:
I had a replacement Iwis brand timing chain on hand but decided against changing it because I didn't want to mess with the exhaust cam and the original chain "looked' very good; as well as the cam sprockets themselves. It pays to keep up with quality oil changes (Motul 8100 X-cess & Mann 940/25 big filter).
When I started it after re-assembly, it sounded like it had no compression for a couple of rotations before it fired up and ran 'like an Impreza' for about 3 to 4 minutes before it smoothed out.
I got the pads from eBay and ordered two sets of them from two separate places. I choose the best looking two pads from the the four. They were the beige ones. Also used were: Elring Tensioner gasket and valve cover gasket kits. For less than $30 plus the OE compression tool ($25), I can rest easier knowing that the pads won't crumble and clog up the oil passages. And added bonus is that the car seems a little bit more eager to accelerate on throttle application. This I didn't expect at all.
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