Not true. It would only be one cylinder not firing if this were the case. In most cases compression is normal with a BHG.
Since you said the engine shut down first it is likely that the timing belt broke.
If the water pump "locks up" the timing belt will be destroyed. When the timing belt fails some of the valves will get bent and some of the cylinders will not make compression. Won't start.
When was the water pump last replaced?
Does it sound like it is spinning over easier than before?
There is a little rubber plug at the top of the cam pulley cover. Remove it and look in there to see if the cam is turning when the engine is turned over for start. If it is not turning the timing belt is broke.
