Water in any of the housings is common in old tractors. While it can be from sitting outside it is not usually the cause. Moisture gets into the housing from the humidity in the air, and the next night it condenses on the inside walls. When the tractor was working everyday the heat generated would drive the moisture out every day. Your tractor had old type oil without the modern additives so it stayed separated for the most part, which is why it was easy to drain off. The small amount that you have left won't cause a problem, but if you really want to clean it up good find some hard work for it. If you put cheap hydraulic oil back in you will be able to drain most of it out easily again. If you put in modern UTF it will mix as yours is now, and you will need to drain all of it annually.
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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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