Welcome to the Journey! The top of the cylinder head looks pretty normal for one of these cars. That oil is normal seeping from either PCV or oil filler cap gasket ( you can replace that cheap but use a Volvo part) Great job on those plugs. They looked fine , no major fouling, but that GS; was way t...

Right, as they burn away, the gap gets bigger.
I've rarely had plugs come out of the box with the correct gap.

The timing belt looks ok, but it's the tensioner that fails. Check your records for age if possible.

Turbo engine spark plug gap should be less. I think 0.028, but I don't have my manual to confirm. Even the photo shows your gap is way to wide. As others have said, they wear wider and then misfire. And likely damage the coils. And always check your new plugs yourself with a wire gaping tool. AND AL...