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White smoke after headgasket 200 1990

So, I finally got to assemble the rest of the engine, and started her up. Had a few problems with overheating (never touched red) for a couple of seconds-just squeezed the rad hoses to bleed the rest of the air out of the system, which fixed it. The exhaust spits out what I think is steam (water droplets shooting out) at idle even after the car warms up. When I first started the car I let it idle for 20 mins with just distiller water, then changed the oil filter and flushed the coolant.

Checked the o2 sensor, voltage is steady at .6 volts. Sounds like a bad o2 sensor for sure-would that cause white smoke? I know there are also a few exhaust leaks, which cause a bit of condensation on their own.

Also, the engine does sound a little different-it whines a tiny bit when the RPMs drop after revving it (very lightly - 1500 rpm). I am nervous that I screwed up bad this time..checked to make sure the head was getting oil (could have put the hg on upside down) - yep it sputtered oil out of the valve cover when I pulled the oil cap - sl that's not the problem.

Anyway, enough of me talking. What could the problem be?

Mike






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