JIMMY,

you can run the turbo as s1, without damage, is it definitely oil in the
water, or crankcase gase's of the combustion chamber, either way i
would say it is related to the headgasket, as for the water to mix with the oil, if you have a leakage type compression test instead of the normal
comp test, it should put some light on the subject, Yes depending is fairly
easy to do head gasket on the rst.

DAVE R.