The cam and crank are in "time" with each other. The crank spins twice for every one time the cam spins. The cam timing relates to when the valves are opening in relation to where the crank is. As the piston moves down the intake valve opens and as the piston moves up the exhaust valve opens. That's two of the four strokes. Piston down intake opens, then piston up to compress fuel air mixture. Then explosion pushes piston down then piston comes back up pushes exhaust out.
You are correct on adjusting ignition timing. Here is a chain that will replace what you have exactly.
http://www.summitracing.com/parts/edl-7800 . The harmonic balancer can be had at summit also. Pioneer makes stock replacement and performance balancers. You can get what you need for under 100 bucks. You don't need sfi approved or anything fancy.