water in the oil - newly built engine, Afraid I will need to start over

[farmerj2000]

Hello all
First off thank you for all the great information on this site. I have been able to solve several electrical issues and answer some common questions by searching.

as you can see from my join date I signed up on here several years back but haven't posted any . I am a bit embarrassed to say my truck has been in my shop collecting dust all this time. My shop is about 50 miles from my house so it was very convenient to put off working on it. Well I finally got motivated and decided to put it back together. I had already did most of the body and interior work. Really all I had to do is drop in the motor and trans.

My truck is a 1970 Step side that originally came with a Straight 6 and lots of rust. HA!

This is the second motor I have put in my truck. I am thinking its cursed at this point!

The motor I recently put in is a 350 with a Saginaw 4 speed trans.

Everything in the motor is brand spanking new. everything was torque to spec as far as the bottom half of the motor. I had someone who builds motors help me. Just to be safe as I hadn't done it before.

Well I dropped the motor in got her running and all was good for a few days. I had a smile on my face from ear to ear. Took her out yesterday and the motor sounded like it was missing. It got progressley worse. I was hoping I burned up a wire, bad plug or maybe a rocker arm was loose. Although we did adjust them.

I thought I would start with the rocker arms, pulled the valve covers and noticed some water in the oil.

I am hoping you guys can tell me something other then want I am thinking.
So am I right in thinking it can only be two things?

1. cracked head
2. Bad head gasket

If it's the latter would that cause the motor to miss? Does a crack head cause the motor to miss bad? What else could cause this? A friend of mind mentioned I could have broken a valve. God I hope not!!

What a nightmare, I am really disgusted at this point. I owned the truck now going on 8 years and really have had nothing but trouble. Every time I get excited and get to drive it something else goes wrong. I really took a lot of time and money making sure this motor was done right. I didn't spare any expense as I didn't want to go through this again.

Any insight would be greatly appreciated.