From what I remember, the water pump is driven by the timing belt on the 95 thru 97 Zetec, and not on the 98 and newer Zetec.
It is highly unlikely that the valves have been damaged as this is a non interference engine. The valves are not supposed to clash with the pistons if the timing belt breaks.
I'm not sure how the engine would keep running but with poor power if the timing belt broke. That kind of loss of power with the electrical system failing sounds more like an alternator or battery problem that led to your stalling.
Until you mentioned the electrical problems, I thougth it sounded like a plugged exhaust which has been sort of common on those with high miles. The cat in the exhaust manifold comes apart and plugs up.
I recommed you get a second opinion from another shop. Valve damage from a broken timing belt would be extremely unusual on that engine.
