foam padding underneath display is significantly damaged and uneven

I don't know if it's worth getting rid of the foam. I would like to know the function. If the phone doesn't function because of the foam, then the display I bought and battery are worthless because it'll be more expensive to replace, if it's even possible at all.

So the if the foam function is important, then I should just return the display that I bought.

The phone will function with the foam but most likely you are going to be using a phone that might get fried because there’s nothing protecting the screen and the rest of the phone. This is a risk to your safety and others if you use the phone like that, there’s a reason why it’s there. If it doesn’t work for you then return the screen and get it repaired somewhere or buy a new one. The price of doing both will be different and it might not be worth it but look around google things and decide for yourself.

Cheers!