V8 Engine Problem

[Tom and Carlyn Jervis]

If you squirt some (heavy) oil in the leaking cylinders, it should 
seal the rings against leakdown unless the wear is really bad (in 
which case the compression should be also).  This should answer the 
question about rings versus valves and if the compression comes up a 
lot tell you something about cylinder wear.  How do you know the air 
is going into the crankcase?  Note that 500-700 miles/qt is probably 
within the "acceptable" range for Audi to avoid warranty claims (I 
think the limit is 600).  It does not seem likely that this usage 
would be poisoning the O-2 sensor.  Does it indicate anything on the 
diagnostic codes?

Bad valve guides usually show smoke on shifting in my experience and 
if they are bad enough to cause poor seating, the valves are probably 
burned by now as well and the compression would show it.  VW AG had a 
lot of problems with valve guide seals in VWs in the 70s and early 
80s and may not have entirely solved the problems.

I suspect something else is wrong  that is causing the miss and a 
full diagnostic is called for.  Check ign wires, for example.  If 
not, I vote with wrench #2, fix the acute problems and leave the 
chronic ones unless you can verify that the valves are the problem. 
A lot depends on how committed you are to this car.  Are you ready to 
rebuild the suspension, drivetrain, electricals, etc. as they begin 
to fail?

Tom
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