In that case, I'm willing to bet it's leaking from the valve cover.
Oil is a funny thing, the way it leaks sometimes. It might not look like a drip, but more like a wet area. I'd blast the whole area with carb cleaner, wipe it all nice and dry. The keep an eye on it.
And as somebody else said - if you're getting air escaping past the spark plug, you might want to try new plugs - or tighten them a bit.
As for the soot, I'd clean that up too and keep an eye on it. If it builds back up, I'd back off on the gas mixture, lean it up a bit. (I'd double check the situation by yanking the plugs and looking at them. Are they black? - if so you're definitely running too rich)
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Today's Featured Article - Women and Tractors - Tractor Engine Repair - by Teri Burkholder. One of the great things about working on a tractor engine with your other half is that you know what he is thinking of at all times and can anticipate his every move and his next thought of what he will do. With Ben, anyway, I can tell! He'll be busy working and I’m handing him tools and he says, "give me that..." and I’ve already got it in his hand or "hand me that....."and I’ve got the portable light right where he needed it placed to see. "Run in the house and get me a...."as I open th
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