Conroy, Thanks for the update. That is how we learn from other people's experiences without getting dirty. I think the "washer" pieces you found are the remains of valve seals. This is a good sign as the blue smoke may very well be cured by replacing the seals. Since you stated in your original post that you are somewhat new to the game, I hope you don't think any of us responders are talking down to you. You can replace the valve seals without removing the heads. It is some work but not a big deal. I suggest you buy a motor manual. Most auto swap meets have a guy that is selling old Chilton or similar manuals. Most book stores carry some kind as well. Around here, old manuals seem to go for $25 to $40 or so. Get one that covers your year. These manuals have all the specs for your motor plus general information on repairs and interpreting things like compression and vacuum readings. Regarding using kerosene: I suggest not running the motor with the crud/kerosene in the motor. After your clean out, flush as I mentioned in my original post. After a good under the valve cover clean out (both sides) and new valve seals (also both sides) you may be pleasantly surprised and find that you solved your problems. You may be tempted to pull the valley cover and clean there also. You have to weigh the possible good against the possible harm (crud in the lifters or oil pump screen). I suggest not doing it unless you think you see some symptoms. Good luck
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