205 1.1 Compression problem

I just bought a really tidy 36,000 mile G-reg 205 1.1 (TU engine) for
a very low price, because the cambelt had gone.

I've had the head off and replaced all the exhaust valves, plus two of
the inlets. All the valves ground in nicely and I crack-tested the
head before that - with a Molyslip 3-pack aerosol kit and it was AOK.
Not warped at all either.

Now that I've put the head back on, with a new gasket and bolts, I've
run a compression test and I get 12, 10, 4 and 12 bar on cylinders 1,
2, 3 and 4 respectively. Bugger! Cylinder 3 was on of the ones that
had a new inlet as well as exhaust valve.

Whilst the head was off, the liners looked fine (seated properly) and
there was no ridge in any of the bores, nor any sign of the piston
rings picking up.

I'm at a loss to know why I've got a cylinder down; anyone got any
ideas? I tested it cold but I don't think a warm engine will give me
back 6-8 bar will it?

/Simon