How it Works10 mins ago
radiator cooling
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No best answer has yet been selected by JB Martuni. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.sounds rather like it. I hope so because the other possibility is a cracked cylinder head. (don't panic head gasket is by far the most likely)
Water in the oil is not a hard and fast rule. You have oil and wather chanels as well as cylinder holes in the gasket - a failure can occur betwen the oil and water in which case you get mixing. or it could occur between the oil or water chanels and the outside in which case you'd get leakage. Or it could occur between the cylinder bore and the oil or water chanels in which case youd get smoke.
I take it you're sure and you haven't got a leak from a coolant pipe blowing onto the engine!