Over the weekend, I removed the cylinders, cleaned things up, replaced all the cylinder o-rings, and put the engine back together.  I hesitated to remove the cylinders, but they really aren't hard to re-install, with the engine out of the van.

I found that the left side pushrod tubes were longer than they should have been. I assume this means that the head hung up on something and didn't seat properly.  That would certainly explain the water in the oil!

Thanks for all the advice on this problem.

Bill