Sounds like a head gasket to me. hope its not anything to do with cylinder sleeves. Think that might be what johns wondering about. heads not all to bad to get off. off with all side panels, muffler, top engine cover, upper rad hose, bypass hose under thermostat housin, cooler line for hydro cooler/heater, breather block and tube from valve cover, a small line on left side of thermo housing to water pump? i left intake/exhaust manfold on so removed carb and its connections. Airfilter housing and tubes for it. remove valve cover, back off all valve lash adjusters to remove tension from rockershaft, remove rockershaft oil line that comes off right rear head bolt to rocker, off with rocker assembly, break loose all head bolts in backwards (reverse) head torque sequence, several turns, then remove head bolts. assembly is reversed but with the  torquing  of head bolts, valve lash adjustments. i always torque head bolts in 3 steps, divide torque by 3, say its 90 #'s torque, first sequence all at 30, next at 60, last at 90. evenly torques head and compresses gasket, and if clearance of other things is issue, can put torque wrench where you get smooth continual pull on each step. Something that carries over from aluminum heads on newer engines. Good luck let us know how it goes. Bill R.