Was able to borrow KTM spec generator rotor tool which worked. Finally pulled the chain and compared the old with new. Guess what, the chain is fine.
It was a hassle tearing into the engine to find this out, but I don't mind. I'm happy to have the experience.
Now I know the chain isn't the fault, it just must be something with the tensioner.
The only other thing would be that the valves are so bad out of spec that its causing the chain to feel like it's loose inside the engine? Is that even possible? I'll leave that to more experienced mechanics to explain.
Going to put it all back together and then check the valves to see where they're at.