I need to replace the head gasket on my daughter's '91 240. I have a head in my basement that I was going to install but I want to get it checked out first. The head has around 210k miles on it already and I want to have it set up to last another 100k miles. It was running fine when pulled out of service with the exception of a ticking noise due to one of the valves having its lash way out of spec (by an order of magnitude).

I'm looking for advice on what sort of prep I should do for this head.

Also, can anyone recommend a decent machine shop in NW suburbs of Chicago that works on these engines?

First get a feeler gauge and check for warpage. Use a straight edge across the head surface and see what thickness of gauge will slide under. If it is more than .004" then the head needs resurfacing.

If you feel adventurous, you could resurface it yourself for around $30 and a bit of sweat.

To check if the valves need lapping, flip the head, plug the spark plug hole, close the valves and pour water into the recess. If water drains out into the intake/exhaust ports then the valve needs lapping.

If you feel adventurous you could lap the valves for around $20 plus the cost of a tool to remove-install the valve keepers. And while you're at it you might as well replace the intake valve seals.

If the valves aren't leaking, then you could adjust the valve lash yourself by measuring the valve clearances, removing the cam and moving the valve shims around to achieve proper clearance. And while you're at it, you might decide to replace the valve hushers. (Assume the new hushers don't subtract anything from the valve clearances.)
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1980 245 Canadian B21A with SU carb, M46 trans, 3:31 dif, in Brampton, Ont.

I did check for warping and it checked out ok. However I don't have the tools for removing and adjusting the valves (need a shim kit). Plus I would like to get the exhaust studs replaced. All of which I would need a machine shop for.

Remember you have 2 heads that need working on. So double the cost. Or get the appropriate tools and learn to do as many as you want.

"However I don't have the tools for removing and adjusting the valves (need a shim kit)."

You may not need a shim kit. After taking the measurements and deciding what shim thicknesses are required, see if you could swap them around to achieve the appropriate gaps for most valves. For the remaining shims, you could swap in shims from the other head.

Or make your own. Easy enough to do. Decide what thickness is needed to close the gap. Then take your caliper into the kitchen and measure the thickness of assorted foil trays.

Once you know what is to go where, you can remove the camshaft carefully (loosen nuts all around a little at a time) to access the shims without special tools.

"Plus I would like to get the exhaust studs replaced."

They are a pain to remove, even using the 2 nuts against each other method. And you risk snapping the studs. Probably better to leave it to a machine shop, if you want them all done.
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1980 245 Canadian B21A with SU carb, M46 trans, 3:31 dif, in Brampton, Ont.

My goal is to set the head up for another 100k miles. I won't be repairing the head that comes off as I really don't have a need for it at this time. The only reason I am rebuilding this head is because the car is 200 miles away. I plan on getting the head ready so I can plan on a single weekend to do the head swap.

I have checked the clearances of all the valves and all are out of spec. thus leading me to the conclusion that a shim kit is required in order to bring them back.

I'm going to check with my local indie volvo mechanic to see if he can recommend a machine shop.