The already-mentioned arcadesolution.com website has some troubleshooting tips for Defenders (in the "Self Help" section). Check out the Rom board troubleshooting subsection...it sounds like you might indeed have a bad ROM.
Andre is a great resource, too, he can fix the boards for you if you are unable to do so yourself, and his rates are very reasonable. Or he can sell you an individual board working if that's all you need.
I recommend getting a switcher power supply from Bob Roberts even if your power seems OK now. They are just more reliable in the long run, not that expensive, and ultimately help protect your boards from failures down the road. I have switchers in all of my Williams games, and I rarely have any problems with them anymore (knock on wood!).
Also replace that CPU to ROM board ribbon cable for sure! Again, it's another high failure point regardless of whether it is the source of your actual problem right now.
If it turns out you need to burn new ROMs, you're not too far at all from me and I have a burner that should do the trick (if you supply the ROM chips). And although I don't have an actual Defender in my collection (I play the game via JROK's multikit in my Stargate

), I do have access to my neighbor's Defender if we want to test individual boards in his game to see if we can narrow the problem down to a particular board. He literally lives just down the street from me...I helped him to fix his Defender a few months back when I first moved to the area and he saw my garage/arcade open and approached me saying he had some classics of his own that were not working and could I take a look.
I fixed both his Defender and his Dig Dug (they were apparently down for many years!), and now we're good friends, too, and our respective kids like to play together, too
Anyway, LMK if you want to hook up via PM.
And congrats on a very cool pickup!
Jon