Do you have fuel supply? (K-Jet needs a good deal of pressure, like at least 65 PSI). If not, fix.
Do you have spark? (These things have electronic ignition, so check the wiring from the dizzy to the module). If not, fix.
But it seems to me there's some clues here as to what's going wrong:
I decided to replace [the water] pump, and timing belt and gear seals while doing the pump. [....] So here is where my issue starts. Once everything was back on I started the car and it had trouble starting but after lots of cranks it finally started but with hesitation, and had trouble revving. I decided to take the timing belt off again and see if I had done something wrong. Put it back on this time making sure I had all my marks lined up. I may be wrong, but presuming you always had good fuel pressure, those symptoms sound like the cam is out.
JFTR, here are the marks which need to be lined up - all 3 of them - with your 123 square tooth belt. Maybe worth checking again?
(pic courtesy of TP30156-2, which can be found in the Oz Volvo Tech Archives)
If the cam one is out, you'll see compression issues.
If the intermediate shaft one is out, it will put the dizzy off.
If the crank one is out, it will put off the other two.
Here's an example of one tooth out.
https://www.flickr.com/photos/102993628@N03/
Also, it may be worth noting that my K-Jet 244 managed to start up after sitting for about 15 years on very cruddy 15-year-old fuel, albeit with a bit of Aerostart and after replacing the main fuel pump, and I doubt your fuel is that stale. It may be worth replacing the fuel filter in the engine bay too.
