Internal engine problems and blowing oil out typically are not connected, unless you blew a rod and holed the block, that is.
You compression readings are on the low side, but not really that bad. I would not rebuild with those readings, unless there are other internal problems as well.
Clean the motor up, and see if you can find the source of the leak. Some possible causes: leaky oil sender, split turbo oil feed line, blown valve cover gasket. If boost is getting into the crankcase, gaskets can blow out, and spray oil everywhere. Only 3 ways crankcase pressure can be high: boost getting in thru the PCV system (past the PCV valve), boost leaking in thru very worn intake valve guides, or lots of blowby due to bad rings.
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Jeff Korn
88 Turbo Coupe: Intake and exhaust mods, T3 turbo at 20 psi, forced air intercooler, water injection, bypass valve, Ranger roller cam, subframes, etc., etc.. // 86 Tbird 5.0 (original owner): intake, exhaust, valvetrain mods, 100 HP nitrous, ignition, gears, suspension, etc., etc.... // 91 Escort: Bone stock winter car // 00 Windstar (wifes vehicle)
Jeff Korn
88 Turbo Coupe: Intake and exhaust mods, T3 turbo at 24 psi, forced air IC, water injection, BPV, Ranger cam, subframes, etc., etc.
86 Tbird 5.0 (original owner): intake, exhaust, valvetrain mods, 100 HP N2O, ignition, gears, suspension, etc., etc.
11 Crown Vic Interceptor
14 Toyota Camry (wifes car)
95 Taurus GL Vulcan winter beater
67 Honda 450 Super Sport - completely customized