It sounds more like a damaged piston and/or piston rings that have lost their tension due to the overheating. At any rate, it's major overhaul time, so pull the engine out and get busy! This might be a good time to upgrade to a 54-up 235 engine, unless you're determined to keep it bone-stock. It's very close to a bolt-in swap, with only a few minor changes to make.
Jerry

Last edited by Hotrod Lincoln; 10/12/2010 8:54 PM.
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