Last December, on my 2001 S40, the bearing in the timing belt tensioner went, allowing the timing belt to jump off the sprockets. I pulled the head and miraculously, no valves were bent. I cleaned and relapped all the valves and reinstalled the head. I did it right too, bought the Genuine Volvo service manual and spent $300 on the cam holder tool. Finished up the project in March(had to wait for parts). The check engine light has been on ever since. I've had the codes cleared several times and they always seem to be related to the cam position sensor. It has run fine and gotten 30mpg the entire time, so I had a hard time believing the cam sensor was actually bad.
In June, my inspection was up so I took it to an independant shop specializing in Swedish cars. After $188 they tell me the cam sensor is bad. But when I questioned the mechanic, he agreed with me on several points (runs good, good mpg, no CEL before tear down) that it seems to not actually be a bad sensor. They also double checked the cam timing (it was good).
I spend a couple months researching online and trying different things (cleaning cam reset valve and screen in gasket, checking wire connections for corrosion, etc) all to no avail. I give in and call the Volvo dealer to see about getting it into the shop. After giving him the total back story he tells me that if I bring it in, they're just going to get the cam position code error, replace the sender and then procede. Still having doubts that it's the sender itself that's bad, I decline to pay someone $70 an hour to do a job I can do.
Long story longer, even the Auto Zone dude clearing the codes for me says "you have to replace the sender". So I break down and finally do, after 7.5 months and guess what, Check Engine LIght is STILL on. almost $200 for a sender that did nothing for me, exactly as I suspected.
The codes I have are P00341, P0017 and P0016. Anyone have any ideas what to do next? I'd really rather not continue buying/replacing 200 dollar parts just to see if one makes the light go away.

Any help appreciated. Thanks.

 

addendum: I've read that engine sludge can cause issues with the oil pressure controlled VVT which can give these codes. I've run the car on full sythetic Valvoline since I bought it with 74,000 miles. It now has almost 140,000 and 80% of my driving is highway driving at 65mph or above for an hour at a time. I don't think engine sludge is the culprit here.