98.5 TDI, hard to start

I am having trouble with my diesel engine. It is a fresh rebuild, and has a ton of compression, now the starter motor will barely turn over the engine, and gets really hot (hot enough to burn my little fingertips) and starts smoking through the alignment hole in the bell-housing. The starter turns the engine slowly for about four revolutions, and then dies. The engine turns freely (although with some difficulty) by hand, so we know it is not hanging up on some sort of mechanical seizure. When I pull the glowplugs, the engine turns quite quickly. Could the starter die under load? Anyone ever seen any problems of these sort? Battery was on charger all day. Thanks in advance.

Did it ever start if after the rebuild or are they directly related? Could starter be installed incorrectly and be binding? Maybe loosen the bolts and wiggle it around then retighten and try. Just throwing things out there.

Turned out to be the starter, but I replaced the battery with a 1000cca at the same time. The starter was failing under load, something about the bushings being worn or something. Much happier now, thanks!