When the piston sleeves were out, was the sealing and seating surface cleaned thoroughly?
The spec calls for the top of the sleeve to be .002 to .0045 above the block surface. If any are standing higher, the head gasket will not seal. May want to have the head checked for cracks. If it was torqued down on uneven sleeves, or has ever been overheated, it could be warped or cracked.
Did you retorque the head bolts after the first start up? Might try another retorque if the head is still on. Is the thermostat in and working, getting it up to temperature?
There is also a history of block cracking on those, up between the sleeve bores in the block web.
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Today's Featured Article - Earthmaster Project Progress Just a little update on my Earthmaster......it's back from the dead! I pulled the head, and soaked the stuck valves with mystery oil overnight, re-installed the head, and bingo, the compression returned. But alas, my carb foiled me again, it would fire a second then flood out. After numerous dead ends for a replacement carb, I went to work fixing mine.I soldered new floats on the float arm, they came from an old motorcycle carb, replaced the packing on the throttle shaft with o-rings, cut new ga
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