Here are the work orders from the dealership, shows what codes they found and what they did to diagnose. I'm going to make a video of the engine noise on a warm engine to try to capture the knocking noise. Thanks for all the help!

 

Before the work was performed I had misfire on all cylinders and after the work was done it came back on with P302/303.

 

It looks like the only things that were actually replaced were the spark plugs, valve cover gaskets and serpentine belt. I would question them as to what "swapped" coil packs and injectors means and how they determined that they "test ok"? I'm guessing that means they swapped them for a new set of injectors and coil packs to see if the symptoms changed, and then swapped back to the original... but it's hard to imagine they would test new parts on your car and then go through the labor of taking them back off. If you would like to check if the misfire is ignition component related, you could swap both of the coil packs from cylinders 2 and 3 to cylinders 1 and 4, clear the check engine light, and see if the code follows the cylinders (which would show as P301 and P304). If the code does change cylinders after swapping the coil packs, you know that is your issue, if it does not change cylinders then it is either fuel or internal engine related.
ETA: on a side note, $25 a piece for spark plugs (should be about $10-12 each) and $94 for the drivebelt (should be about $60) is robbery. $263 for labor on the valve adjustment and spark plugs is steep too, it should take only a few minutes to change the spark plugs, and the valve adjustment should take less than an hour by an experienced mechanic. Unless you brought the car in early in the morning and they didn't start work until the afternoon (or you left it overnight) there is no way they adjusted the valves properly. The engine needs to be stone cold when they adjust the valves.

 

Most logical answer though: they swapped parts to find the misfire codes stayed where they were in the beginning.

That is why they diagnose it as valve and/or lower end issues.

How old were the old spark plugs?
Old enough to drop a tip and scratch a cylinder?
Did you see them?
OTOH, why wouldn't they tell you....

 

It looks like they did what they thought would work and performed normal maintenance, not fix the problem. So they failed to fix or even tell you what exactly was wrong. They did the maintenance and they did replace parts so they did what they could and charged you full bore for it.

I would take it to an engine shop or a shop that specializes in honda cars. They should be able to fix this.
If you really want to do something, you can remove the head and send it out. That is allot of work and that might fix the problem based on what they recommended.

I would take it to a shop that fixes honda cars.

 

Ok I'll definitely test the coil packs, I'm not going to take my car to that dealership again. I'll have to take it somewhere else, not too many shops around here know much about S2000's. I know PTuning is about an hour away though, in a different state lol.

 

Unfortunately I don't have the answer to most of those questions, I didn't see them but as far as i can see they hadn't been changed in a while.

 

I wish we had a Honda shop around here that worked on our cars, I only took it to the dealer because I would expect them to know the most about it.