525i oil in coolant, still looking for the answer :(

so recently i bought a 525i for 500.
the previous owner said that he replaced the radiator
due to oil in the coolant. this car overheats fast, oil in the
coolant, water in the valve cover lid, white smoke, no fouled spark plugs,
also this white/grey cottage cheeze oily substance is in my air intake, all the way
to the filter? the car drove fine before i took it apart today.

so i got down (or tried too) the problem. what i found was a new cylinder head, (well
extremely clean looking, outstanding quality to the block) no major breaks in the
gasket. my eyes are only human, but no visible cracks, in both the cylinder head
and in the block.

now im not sure if the problem is with them reassembling all these parts together,
or something else. im not even trying to imagine the worst case possible.
oem gasket? incorrect torque on head bolts? I have the resources to fix,
this car is almost 100% mint, i do not want to let this baby go

Originally Posted by jasoncapitalp

so recently i bought a 525i for 500.
the previous owner said that he replaced the radiator
due to oil in the coolant. this car overheats fast, oil in the
coolant, water in the valve cover lid, white smoke, no fouled spark plugs,
also this white/grey cottage cheeze oily substance is in my air intake, all the way
to the filter? the car drove fine before i took it apart today.

so i got down (or tried too) the problem. what i found was a new cylinder head, (well
extremely clean looking, outstanding quality to the block) no major breaks in the
gasket. my eyes are only human, but no visible cracks, in both the cylinder head
and in the block.

now im not sure if the problem is with them reassembling all these parts together,
or something else. im not even trying to imagine the worst case possible.
oem gasket? incorrect torque on head bolts? I have the resources to fix,
this car is almost 100% mint, i do not want to let this baby go

Sounds fishy to me.

I would not even mess with it.Find a used one unopened.http://cgi.ebay.com/ebaymotors/BMW-U...Q5fAccessories

It seems like a head gasket failure. If this was recently done it may have been done incorrectly. Incorrect tightening of the headbolts will cause a new gasket to fail quickly.
Something as simple as not cleaning the blind bolt holes will prevent an accurate torque reading, in the worst case scenario a bolt hole filled with oil then having a bolt tightened into it can crack the casting.
Too many people working on engines that shouldn't, sounds like you found one.
Is the block or head surface corroded? A badly corroded surface will prevent the gasket from sealing as well.
I vote to properly diagnose and repair what you have rather than start over with another unknown.
Having said this ^ I have an engine should you be interested.
Post pictures of the gasket

Agree with Ross1 but go further and have the new head tested. Perhaps there is a small crack which you cannot see. It may be expanding when heated but the only way to tell for sure is to have the head magnafluxed. PITA but better than putting it all back together only to have to remove it again.