Man I saw "6 hours tracking down a bad valve" and it brought back a story my buddy told me. He was working on this old building's main water line, same size as yours I think, and spent almost a whole day chasing a leak that kept leading him in circles. Turned out the valve was fine but the handle was stripped so bad it looked closed but wasn't really shutting anything off. Had to cut the whole thing out with a torch because the threads were just gone. He said he almost threw his whole toolbox in the river after that one, six hours is rough but at least you found yours.
Gotta say, it's not just the handle that was stripped, the whole valve was shot if the threads were gone. Torch was probably the only real option at that point.