Ok, I just got back from the place that recurved it. The guy that did the work said that he has never seen this type of damage this bad before. The shim and the thrust washer were all but welded to the gear. He had to use a hammer and chisel to get them apart after removing the gear. He couldn't say for sure what happened, but he thinks it's a combination of me tightening the distributor down a tiny bit more due to reusing the gasket and the fact that he DID use a shim to take up some clearance in the shaft. He said that the shim alone would not cause damage this bad unless the shaft wouldn't rotate after he was done. I know it rotated when I picked it up.
He also thinks the distributor is reusable, so I am going to have him repair it. He is going to put a new gear on with a new thrust washer and shims to take up the clearance. Then, after I get it back, he said to use the paint that you use to set up a rear end and paint the gear. Then install the distributor and turn the motor over by hand to see where the pattern is. If it needs to be adjusted, I'll have some shims to do it with. I'll also check to make sure that the oil pump drive shaft is not binding.