Sounds like a bad rotary valve leak.
Pull the spark plugs, and turn it over with the starter. If oil spews out the plug holes, that's it.
The rotary valve is down on the bottom of the motor, in the middle of the crankshaft, and has a brass gear on it. The crankshaft gear turns the rotary valve, which allows the fuel/air/oil mix to come into the crankcase, at a pre-selected time. This set of gears has lube from the oil tank. Thats what those hoses from the oil tank are for. When the seals go bad, oil goes straight into the motor, from the crankshaft. And, usually, that means a new crankshaft.
Alot of folks just put a short block in them at this point.
Nate