The button looks o.k. It doesn't have any dings in it so it prob. didn't have anything on top of piston when running. That's a bummer . Sorry you had problems. Here is a good engine for the money.

http://www.amainhobbies.com/product_...-Standard-Plug

Foxfloat,
Looks like there is a piston and sleave that you are going to have to order.
Next time, after repairs, get a temp gun for your engine.
Duratrax is the brand namee, Flash piont is the name of the gun or infrared temp gauge.
Get a owners manual for the car and learn how to set the temp of the engine.
Most engines run well at 200-215 degrees. 250 dgrees is too hot usually.
Good luck[8D]

Also look at this for breaking in a new engine . I use this method & it works great.

http://www.rctech.net/forum/nitro-of...eak-bible.html

yea i was using the old school break in method. but i called ofna again and they said to send in the motor and they said it would cost me 80 dollars at the most to get a new motor. but first I'm going to send ofna the pics before i send the motor in and see what they say.

that definatelty looks like a bunk piston, from the rest of your pics everything else looks fine... you could find a better engine on ebay fo not much more than 80 bucks... I would steer away from the ofna engine unless it is a hyper engine, those are pretty darn solid and zippy to boot...