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It's a good theory as far as it goes, but that's not good for head gaskets. All by itself, a head gasket isn't strong enough to hold the forces of combustion inside the engine. There's been a variety of surface recommendations over the years to give the gasket some traction against the head and block surfaces. From coarse to fine, with prick punch recommendations for some of the old high compression v-8's! Head gaskets usually come with a faintly tacky or sticky surface coating on them to help them bond to the head and block surfaces, further keeping them in place. So, you're right about the notion of silicone lubricating the gasket and helping it to slide around. But that's a bad thing for a head gasket. Since these are low compression engines, and robustly engineered, you do get away with this. Especially since you are conciencious about retightening the head bolts or nuts. One should do this, unless they are using a stretch to yield head bolt or a specifically designed non-retorqueing head gasket. Something that doesn't apply to N's. As far as the original question goes with regards to orientation of the gasket, I don't think it really matters here. It's an iron block with an iron head. Mine is on exactly opposite of the previous recommendation (seam side down). I used some sealant (my beloved ultra-copper), but that's only because I used the old head gasket (gasp!). Carrol Smith advises using some pipe thread dope on bolts going into water jackets. Specifically Loctite's brand. Good advise, I probably should have done that. Remember too, it's better to slightly overtorque then to undertorque.
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