Is it a mechanical pump or ECM based? It sounds mechanical.
Now, it's possible something caused the injector to stay open and the cylinder put in enough fluid to slam the piston and rings (intake valve not opening would eventually fill a piston too). This could've damaged the rings, the journals, the bearings or anything in the cylinder. Now it's not happy. That #475 when the others are running #500+ would bother me, why is that cylinder down so far?
I'd tell them to repair the entire cylinder and let them know it's on their dime. The compression reduction, by comparison, should bother them more than it is. You may have a defect in the cylinder, which I would buy more than the timing.
Old School logic:
If #1 timing is off, so would all the others and it wouldn't run at all, or sound like it wants to die. That first cylinder, TDC is critical to the timing point. Everything else follows. On mechanical pumps, that's where all the marks line up, #1 TDC. If yours is electrically based then I guess it doesn't matter, but that cam will likely still be timed to #1 TDC.
If you look at this from the triangle of fire perspective: Fuel * Air * Heat . You seem to have ruled out two of them, what about air? Is the valve working properly? You mentioned something about it, but if it's not getting enough air, that will also be a problem...
This is all mechanics 201, not basic but intermediate. I'd tell Kubota to find and fix it and let them know that cylinder is their problem until the engine dies of old age so they'd better fix it right. I don't think you have a lemon, per se, but you certainly might have had a bit of bad luck and it caused a problem... it happens.