Mike,
Having built two Upshur's I can tell you that the valves on both my engines stand about 1/32" proud of the base of the cylinder head. There's not much metal on the valve face or seat, so take your time getting them set just right.
I had to re-seat the valves on the first one and still did not learn anything....I had to re-seat the valves on the second engine also!
This is a great engine to build and I think it suits itself as a really good entry level IC engine. In fact, just the past weekend, I was considering building a third. Maybe this time I'll remember the valves! ;D
John