oil in water, low compression

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I bought a 2006 GTI for a project and my discoveries were as follows:

1. Very low compression 60, 90, 90
2. The coolant system was full (and I do not mean some but FULL) with oil ... like mustard ...
3. Oil level was ok and oil looked not milky (i was not able to turn run the engine maybe that steers the oil to become milky?) When i extracted the oil it looked black/normal
4. Engine cranked but would not start
5. Fuel pump dead ... LOT of debris in the fuel tank, filters were orange. (changed the motor in the fuel pump, changed filters, drained and clean the tank)

Ski has 130 hours and was saltwater.

I have found a hole in the exhaust mainfold and changed it.

I have removed the engine, removed the head, changed the head gasket, pistons and valves looked ok (not blended). I have removed the water pump cover and clean all the oil, cleanes oil from all hoses with warm water, cleaned the hull. Put everything back together.

I did the timing according to the manual. Now here comes the questions for you:

1. The ski does not have oil in it now and while i had the engine out, after doing the timing i put in the driveshaft and was able to spin the engine but felt the resistance from the valve springs. Meaning I would have to rotate hard, i saw the valve spings compression and once it pass the "peak" it would jump and rotate a fraction of the driveshaft in my hand. Are those spring so powerful that they can push the whole crank and pistons? I need to mention there is no oil in the engine now, does this make a difference ? What I experience is it ok ?

Other than the head gasket, i pressure tested the oil cooler ... what else could cause so much oil to get into the coolant ? Again when i say "much" o mean the entire colling system was filled with a greasy mustard oily liquid.

I am attaching some pictures of the head and pistons if you spot anything wrong please let me know.

Any advice before i put the oil and fire it up ?



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