89 Mustang LX 2.3 Cooling

[84LX89GT]

What i would check is to see if your engine oil looks muddy (coolant in oil), since you overheated it that badly you may have blown a head gasket. The electric cooling fan may have failed and caused it to overheat like that, or possibly a relay or even a fuse. If you have an owner's manual sometimes it will show where the cooling fan relay is. make sure to go through and check all the fuses to see if any are blown. some vehicles have the high and low speed relays in what is called the CCRM or Constant control relay module, but i'm not sure off the top of my head for your vehicle.
Having 90 psi compared to 170 for the other cylinders shows there is definately a problem with the cylinder sealing, if you have a coolant pressure tester (or if you can acquire one) and you pump up the cooling system and it bleeds down (especially if you can hear a hiss from the affected cylinder with the plug removed) then you probably have a blown head gasket. The fact that it was knocking may be bacause the oil was overheated and aerated (air bubbles in oil causing cavitation = knocking).
If there's a library nearby they will probably have a chilton's or haynes manual you can check out, also you can go to schuck's and buy one for your car. make sure to read through the book before you buy it for what you need because if the info isn't there it's a waste of money. Unfortunately i don't have any of my books handy (no internet at my place/haven't unpacked all my stuff since i moved) so i can't give you the definate answers you need.
Good luck, i hope this helps