I apologize, after searching I found one subject close to what I'm asking, but did not directly answer the question.

When the cam gear marks are aligned in the center facing each other, are all valves closed?

I'm getting close to timing the engine, but I need to put the cams back in. However, I would like to make sure they rotate without binding before putting the belt on. All pistons are mid-travel in the cylinder (all in the center) so that when the cams spin I won't have valve to piston contact.

Now, when I align the cam gears to the position required to set the timing, I just want to make sure that when they are aligned I won't be hitting a valve with a piston when rotating the crank over for cylinder 1 to 1/2 tooth before TDC.

you won't hit them. Install them as if they were factory gears, then time it.

A more accurate way to ensure your Cams are at 0*/0* is to use the locating dowel recesses on the cam shafts near Cylinder 1. Still some 1/4" drive extensions in the holes and make sure both are at dead 12 o'clock.

As far as all valves being closed, I think cylinder number 3's intake valves may either be opening/closing with the cams zeroed, but I do not remember exactly.

As long as the holes are facing up, and the crank gear on mark you are fine.

There is no locating pin or keyway on the cam / cam gear mating surface?

And, when cams are installed and clocked with the marks facing each other (3 and 9 o'clock respectively), valves for cylinder 3 are slightly open?

Yes there are locating pins for the gear to cam mating surface, but there have been some isolated cases of the pin not being 100% perfect. The holes drilled into the camshafts themselves are more accurate.

As far as Cylinder #3 valves, the piston is at the bottom of the cylinder, so the valves would just be closing as it is at the end of the intake stroke (assuming it is cylinder #3 that has valves open - again this is just what I remember from when I installed my head last).

I just took a look at the cams last night. I never took the gears off, and the alignment holes on the cam are a few inches in from the cam gear, correct?

If this is the case, and they are supposed to be aligned as above, something odd is going on! Place the hole at 12 o'clock position, the mark on the intake cam gear is close to 2 o'clock, and the exhaust is about 10 o'clock. Is that right?

Yes the locating holes should be right on or near cylinder #1. You will need to take the gears off to replace your cam seals.

Wow, that is pretty far off. I have heard that the difference between cam gear marks and locating holes being as much as a tooth or two, but never that big of a jump.

Take a look at this thread over on Neons...

http://forums.neons.org/viewtopic.php?f=46&t=351182

I would personally go with the holes, not the gear marks. When I timed my 2.4 I had adjustable cam gears to adjust for having the deck milled. I used the locating holes in the Crower 3s however and some 1/4" drive extensions to zero them.