Another update...
.Had a chance to put it in the water today and it actually ran pretty good. Hit about 4200 RPM, topped out around 41MPH, got on plane really quick and NO MORE BACKFIRE
Thanks to the help I got here I found a broken valve spring which seemed to make all the difference in the world. Boat runs great now
Now the only thing I need to figure out is the water issue still in the oil. So far since finding the milkshake I have changed the oil and filter three times. When I dumped the oil last...(this morning before taking it out on the water) it was much lighter in color than last.
Now...two things....On this last batch of oil I never ran the boat in the water...just several times in the backyard on the garden hose and no more than 1500 RPM... the other thing is I put about half a can of sea-foam in hopes to break up some of the gunk down there. Do you guys think either of these factors would make the oil much lighter?? its a yellowish cream colored. (Banana Milkshake?)
I am really hoping that the water in there was due to bad manifolds/risers and seeped in past the rings during the boats past history. At the worst just a bad head gasket. Thats what the guy at the machine shop thought yesterday when I picked up the replacement valve spring....He thought that even tho I have great compression all around...that sometimes those 4.3 blocks can leak water just near the bolts for the heads......
So what do you guys think my next step should be??
Change the oil a few more times and see? (remember...I have good compression all around and motor runs great now) Or go ahead and rip the heads off and look with my own two eyes and make sure....
If I do take the heads off what do I need for gaskets?? intake, two exhaust and two head gaskets right??
Thanks everyone!!