I just rebuilt my 1983 chevy 305 merc marine motor, new pistons, cam, bearings, etc...When I followed the instructions from a manual that I downloaded, "one full turn past lash" the valves were not closed all the way. In order to get them to close and make compression I ended up with one quarter turn past "lash" in order for the valves to close and the motor runs just fine. My question is am I going to do damage running it like that or is that normal considering they are hydrolic lifters.  

No, you won't do any damage. One full turn past lash is too much. 1/4 to 1/2 turn is all that's necessary. You won't do any damage.