Thanks guys for the concern....really nice of all of ya....My Roddin' Family! hahaha....
The look of rust in the bores were probably from a valve being hung open, and someone washing the motor, or a little rain. Almost 90% of the cracks and bad leaks like that comes from someone taking a perfectly good motor, steam cleaning it or washing it, then when winter comes it freezes. Same with the Powerwashers. After I use one and its close to winter, I just pour a little Antifreeze in the injector side where you put the soap, or hang the siphon tube off in there. Protects the pump, keeps it lubed, and protects it from freezing.
The rust down in the port aound that valvestem is a puzzler, unless there was a crack there, or there was just sweat and dampness hanging on there.
In the past I have yanked a motor out, completely cleaned it, put a complete rebuild kit in it and gone on about my business, but thats when I was young and stupid.
IF you pull a motor for your Rod down, its always best to measure and check EVERYTHING! If you don't have the mics, use plastigage. Bores take the Mics and telescoping gauges. Always, I mean ALWAYS have your pistons in hand to bore your motor.
If you build a old school bigblock with the oldschool clearences, you can build a nice little hotrod motor with a old alum. HiRise, a RV cam, deck the block and shave your heads to hit about 9.0 to maybe 9.2-9.5. Anything higher than that and you'll be fighting the octane in the fuels. Unless you build a ethanol motor and jet it accordingly.
Go Slow, take your time,and do it right. If your diligent, and shop wisely, you can build a helluva motor for under a $1000. Machinework will eat up a good bit of that.
You can get a BigInch stroker kit for that motor (that comes with all the crank/rods/pistons, etc), have all that machinework done, assemble it, and never have to rev it past 4500 to really scare the hell outta yourself.
Me, I LOVE force induction. Build a good stock strong base motor, which is not any more expensive than a stocker except for the rods (if you use a truck motor to start with), then put your money in a blower, or a small dual turbo setup.
If you fashion up alot of the custom made parts yourself, you'll save a good bit of money, plus make it your own, so it'll be totally unique to your car.
Just remember, you don't have to have a ton of money to be cool or to look awesome. Theres still alot of cool older intakes out there for the BBC's. Do a good basic rebuild, put a little cam in it, a gear drive if you like that sound....and a old logger 3x2s/ 4x2s/ 4x1s or 2x4's....do it your way, the way you want it. You'll be happy, have pride in your car and Cruise with it. And maybe get a younger soul hooked on our sport to boot....
Happy Cruisin'!