Well you need to post the model number of your engine.

I THINK you may be describing an 18 hp horizontally opposed twin cylinder, a 42 series engine. IF so, no, head gasket is not going to do that. An overfull crankcase from gas leaking thru the carb and into the crankcase will. Did you check the oil level?

Oil is likely to normally spray out the oil fill tube of a running engine, however, the crankcase breather MAY be bad, check oil.

Walt Conner

Have you turned the engine since you removed the heads?
Turn the crankshaft and check the condition of the cylinder walls. If the engine was run low of oil and the pistons galled, that could be the source of the excessive pressure in the crankcase that is blowing oil out the breather and the dipstick tube.
Do you know the history of this engine or is it a recent acquisition?
I'm not really getting what you mean about the external space between the pushrod hole and the cylinder. ???
As Walt suggested, post the engine model and type number.

it's a vertical engine. the cylinders look ok. it is an acquisition. the hour meter on it says 350 hours and it works. the tires are original and look brand new. The dipstick is halfway on the oil stick. Funny thing is when i got it wouldn't start for nothing. took off air cleaner started right up. put it back on wouldn't start. I took a recently changed one off another tractor and put it on. same thing wouldn't run with it on.

model# 35077 type 0117-01/3898 code 94012511

Well, it is certainly a V-twin Vanguard, but the model number is actually "350777".
What you say about the presence of the air cleaner preventing the engine from starting is not good news. This one detail could be indicating that the engine has been running for a long time (maybe its whole 350 hour life) with a leak in the induction system, somewhere between the air filter and the cylinder heads. The kind of wear that occurs when the engine inhales dirt/dust can cause piston rings to wear down and/or become stuck, causing lots of blow-by without leaving much visible scoring or streaking of the cylinder walls.
Probably would have been a good idea to do a "cylinder leak down test" on this engine before pulling the heads, but who knew it ahead of time?
I don't suppose you ran the engine with the valve covers removed and looked into the pushrod gallery to see if compression was jetting from the cylinder area into the pushrod area, or did you?

Kinda looks like you may have no choice now but to reassemble the engine with new head gaskets and try it.

And to answer one of your other points (oil under engine and on PTO clutch).
The sump gasket cannot/does not CAUSE "positive pressure" but if the crankcase is pressurized because of a head gasket compression leak, or because the engine has excessive blow-by, the pressure will push lots of oil out the sump gasket if there is even the slightest defect there.

Thanks. yes i did run it and didn't notice anything. i did a half ass leak down test. i used my small compressor to put air in the cylnders. I loosened up the rocker arm nuts to keep both valves close. I did hear air going into the crankcase and stuffed a rag into where the lifters went and the air noise got quieter. There is some discolorartion of the cylinder. tends to be darker. maybe that is a streak.

I was doing some researching and the rational about the sump pump gasket is that if the gasket is bad then the oil pump leaks pressure into the crankcase??? Looks like i'll be pulling the engine either way. If it is the rings and bad cylinder why didn't it smoke at all when it was running and spark plugs were perfectly clean nice beige tan with no carbon at all.

thanks

on another note i have a ranch king pro garden tractor with a good running kohler cv18. if the crankshaft is the same length i maybe able to toss that one in. the ranch king has a manual deck pto goes thru belts like every 2 month and something is always breaking. can't stand the f'ing thing.

i did a compression check and got 110 on both sides but i didn't know i was supposed to do it in reverse because of decompression mechanism on cam.

found this article author says crankcase leak can cause problems like i'm seeing.

http://www.edensltd.com/crankcase_vacuum.htm

Seems like a logical summation and I like the idea of making your own "water column manometer".
Judging from everything those folks have run into, it looks like your problem might be related to a defect in the crankcase breather after all.
Yours has been a puzzling case so far. None of the usual suspects or even symptoms/details have been "typical".

I know this is an old thread, but just wondering if the problem found and fixed. I'm experiencing the same issue on the same engine seeking info to fix it

I too am having the exact same issues with my 2012 18 hp Vanguard engine. I Would love to figure out what is going on. Please help me if you can, it has been driving me nuts.