J/D 40 engine problems

Here's some stuff that has worked for me.

As Henry said, I'd start with the head gasket. That copper stuff works great on that gasket. Make sure the torque on head bolts is correct. Then the head itself. You may have to have the head magnafluxed to be sure. The 40 heads are bad for cracking. If that fails to turn up a crack, I've seen cracks in the cylinder walls. You can make a fitting for an air line to put in the spark plug hole. Remove the radiator cap and pressurize the cylinder with air with the piston down. If the radiator water bubbles, rotate the motor to put the piston up. If it stops bubbling, it's cracked in the cylinder.

It turned out that the head gasget fixed it, I put some of that copper coat snake oil oil on the one I put in just for the hey of it.

The gasget that I took out/off looked great also.

But i did have the head checked for cracks way back when originally when i put the gasget on that leaked.