One of the plugs (No. 7) was almost half way out, and from the gloop all around it I would say it had been running like that for a while. Four of the bores had water in them, but I think that was probably a result of the previous owner’s attempts at cleaning things. Some of the plugs were oily (one of them was very bad) but from looking at the state of the combustion chambers it seems likely that it was running OK. However there were signs of a gasket leak into the water way at the rear of the LH head and impending leaks elsewhere, so it’s just as well that you decided to overhaul it. The bucket tappets all seem to be reasonably good but I haven’t inspected them in any great detail yet. Both cams look good, although there is slight wear in the camshaft bearing housings – not unusual, – but I might try to get them scraped.
Oh, I almost forgot… there’s loads of crap in the sump – but I’ve seen worse.