As I recall the problem was cylinders 5 and 6 had very oily spark plugs leading to the conclusion that the oil smoke was coming from those cylinders. It is pretty hard to determine bore condition with a scope (at least I have not been able to) and impossible to determine if you have stuck or broken piston rings. I know it isn't free but you can pull the cylinder head (new gasket required) and get a better look at things although unless you remove the pistons you cannot look at the rings. You can rebuild the engine without machine shop work if you find that the problem is stuck or broken rings although it will not be as good as a complete machined and rebuilt engine.
Did you repeat the leak down test you reported on earlier? I recall there were some questions about the process and results of the earlier test.
Do you know anything about the history of the engine other than it was removed at a salvage yard? It seems likely that the engine sat for a long time and rings can get stuck. I know there are treatments for stuck rings that may free them up without tearing things apart but I do not have any personal experience or recommendations.
