yikes :S, the only time i had that problem was when i had a late 70's YZ and basically it did same as you did, power died, and when you tried to start easy to kick, and backfired
turns out one of the circlips disappeared, the wrist pin had scored the crap out of the cylinder, and then the rings got hot, then a good chunk of the top of the piston went right out the exhaust lol
like Jasle said, i will also bet on the stuck ring situation from the piston not being in proper orientation, as soon as you loose one ring, your compression goes to crap, and if theres a few scores in the cylinder then its even worse compression
worst case you might have to get the cylinder bored out a bit, and re-sized, i ended up taking it to an amazing local guy who machined it for me, and fitted a new piston and rings, after that it was perfect
personally, i would tear it back down and hope for the best, if it just died then it may not be too bad
color of plug should tell the story tho
goodluck
(also if not watercooled pull head like i did on mine, much easier)