Sounds like you just needed new rings to me. I suppose the piston could have warped. Sorry to hear about your misfortune. Out of curiosity did you ever try the new piston and rings in the old jug? I know its taboo to do so because of the rings sealing and all but I would be curious if it ran well. If you have a caliper you could check to see if the cylinder or the piston is out of round. Do you still have the old kit though?
I really haven't ran mine above 35 save for a few quick spurts and I have not seized it. It doesn't get nearly hot enough to melt my spark plug boot either. It also turns over easily by hand. I am going to change plugs and re-gap slightly smaller to see if that helps. First I have to fix the clutch cable though.
Also I am going to let it warm up and pull the plug (I put a nice coat of anti-seize on it) and see how freely it turns over. If it did overheat and warp the piston I can have it trued when I visit the machine shop. Worst case scenario there is new rings I would think.