the powervalves shouldnt be an issue, holleys have had the protecters since like 84 i believe?

now i think the carb backfire is the best estimate..check your timing...make sure its dead on, sounds like its so far off that itll crank and the backfire you got possibly pushed the smoke through the pcv system back to the valve covers...the heads are closed off, there really is no other way for smoke to get in there besides the burnin oil off the valvetrain or stuff working its way up from the crank case. and there is really no way to explode something in the crank case other than a hole in the piston and fuel gets down there and something catastrophic like that.