  We present a thorough and detailed investigation of baryon isocurvature
models including realistic thermal histories, \ie, late or partial reionization
of the universe and compact object formation after standard recombination.
Constraints on these models are imposed from spectral distortion in the cosmic
microwave background (CMB), number fluctuations in galaxy counts $\sigma_8$,
and recent CMB anisotropy observations. Since the status of degree scale
anisotropies is as yet unclear, the lack of spectral distortions is the most
serious constraint on the spectral index of initial fluctuations: $-1.2 \simlt
n \simlt -0.5$ in partially ionized models and $-1.2 \simlt n \simlt -0.9$ in
compact object dominated universes in order to avoid significant bias in galaxy
formation. Full ionization of the universe before $z = 300$ is also forbidden
by this constraint. Intermediate scale CMB fluctuations which are significantly
larger than standard CDM is a {\it robust} prediction of these models. Many
models are consequently in conflict with the recent degree scale detections by
Python, ARGO, and MSAM, \eg, compact object dominated models with $\Omega_0
\simlt 0.2$. Moreover, {\it all} models will be ruled out if the low CMB
fluctuations on degree scales as detected by the SP91 13 point scan are
confirmed. On the other hand, most models fare well compared with the high
Tenerife and MAX detections.
