Charles! Thanks!

I'm in agreement with you, right down the line...at this point i'm praying it's a head gasket.

I have a eng./tranny I just pulled out of my first volvo, an 86 760 230f tic wagon. The exact same setup. My 89 (the one in question) was made in late 88, so it's still got a hall sensor vs. the crank sensor. I was hoping to have a little more time to prep that engine before throwing it in this car.

I'm heading over to the garage/house in an hour, start the head job.

I'll be sure to post pics of the rare species " Sleevus genus volvus 230um", when I open my little surprise at home. Hopefully later today.

Thanks again for the advice