I have an 02 ram 1500 4.7 quad cab. Rebuilt engine 10k miles ago. Only thing that wasn't checked by the machine shop was the heads. I bought them off of ebay already refurbished.

Problems:
I have always had a valve knocking when it was cold on the passenger side. After it warmed up. It quit. Now the weather has turned colder it started up again. I had the check engine light came on. Took it to autozone where they told me it showed miss-fire on 5 and 7. Then it also showed multiple miss-fires. Reset the computer and it was fine. Now the lifter knocking/tapping I hear on the passenger side. Also I have oil on the block from under the head gasket, down. I pulled the top off the oil fill tower to discover (jelly looking) substance. It looks like oil and water mix color but not the viscosity of oil and water mix. After pulling the valve covers, there was no trace of this (jelly substance) setting on top of the heads or none in the oil pan. I started removing the radiator to give me room to work (back problems), and performed a compression test. ( #1.185) ( #3. 185) (#5. 180) (#7. 190) (#2. 200) (#4. 195) (#6. 195) (#8. 195). So from what I guess, if the timing was off I shouldn't have that good of compression numbers. If I had a blown head gasket/gaskets, I shouldn't have those numbers either. The question is how do I have oily water just in that spot, (unless the rubber o'ring is bad), why would I have oil from the bottom of the head down the block on both sides? And why would my valves sound like a diesel engine? I also had white smoke coming out of the exhaust before I started working on it.

 

Not sure about the oil coming from the cylinder heads with those compression numbers but the 4.7 and 3.7L are notorious for having issues with noisy hydraulic valve lash adjusters if the oil changes are not kept up on a proper schedule. You can buy a tool as I did i believe the company is Wise tools. This specialty tool allows you to change the lash adjusters without camshaft removal it is about $70 but well worth it. It will take some time to do this job but so much easier than removing the camshafts. If you pull them out you will notice some that rattle therefore not maintaining hydraulic pressure causing this top end noise. As for the white smoke I don't no what to say other than this is usually a tell tale of a head gasket failing but I would think your compression numbers would have indicated this?

 

White jelly under the fill cap is totally normal for the 4.7.

 

Ok. I have one lifter that has collapsed. The rocker is about to fall off if you touch it. Have a few more with some play. I got hold of the company I bought the heads from refurbished. Trying to find out if these lifters are from the old cores or if they are new. Im tired of changing one by one. Im thinking the oil is coming from the split block not the head gasket. I have too good of compression numbers to be a head gasket. Has anyone else had experience with changing the oil grade. I have read some post but without a definite answer. Works for some and not others. All other parts are new. (Read that dealers are saying that timing parts are problematic). Nothing wrong with my timing, timing chains, etc. Thanks for your help.