300 Verado Crankcase oil has water

[1800provse]

Checking oil i noticed that i had water mixed in with my oil and white on the dipstick and under the fill cap. Also had strings in the oil when checking. Changed oil and began some diagnostic work. t-stat was functioning and opening ~140 and oil cooler appeared to be working correctly and also took apart due to the recall even though my serial 1B967729 was not included in the service bulletin. Oil would probably push out from what ive read as the block pressure would overcome. Went on to run to temp for about ten minutes and performed a compression test. From top cylinder down: 150,149,150,163,150,149. Noticed the one with 163 had a wet plug tip that appeared to be water when removed. Next, we completed a leak test by applying 70 lbs, results are: 66,65,66,66,64,64. We felt this was odd and we would have seen something. We think there may be an exhaust valve or inlet valve issue on the down stroke to suck water in? Any help of feedback on what next to complete and if a head replacement work is needed any feedback on complexity as would like to try based on some prior Opti experience with reeds etc, Thank you very much for any feedback and or places to get a guy going for a repair.

[EuropeanAM]

Leakdown really is best done at 100 psi, on a hot engine. Compression tests are difficult to perform "properly" on the Verado models (see FAQ section for "Compression Testing").