I suppose its possible you threw a rod by over-revving the engine in the dive.
I fly Hurricanes mainly now and dont have enough experience with the 109 to say exactly what happened. I do know that one time I started up the hurri and then shut it down before take-off. I fired it up again and the engine wouldnt stop shaking and I had to respawn the plane. It never over heated or anything so maybe theres just some kind of general bug with the engines.

In this case though I would say you over-revved it and threw a rod, or perhaps bent a pushrod or two causing the loss of a cylinder. Lots of things can go wrong with an engine when you start pushing it too hard.