Hydrolock???

It's really obvious from the pictures that it has rotten disintigrated head gaskets at the very least.

Turn it till all the pistons are down in the hole a bit and pack the cylinders with lightly oil soaked paper towels. (so they stay packed down)
Scrape the deck with a sharp putty knife and/or single edge razor blades in a handle of some type (like a painters widget)
You can even block sand it with 180 wet/dry paper to get the surface clean of baked on debris.
Then pull the paper towels and shop vac the cylinders.
All this is assuming you are not going to pull the engine and have it and the heads cut for straight.
I have used this method for decades to temporarily save a motor and got away with it.

But there is also a fair chance it will do it again due to uneven surfaces.

Those valves probably need attention also (fair guess:D)
Pulling the springs one at a time and lapping them with a compound and a drill can extend the life awhile if they are not pitted or cracked.
Replacing the guide seals as you do this is a good idea.
Once the heads and intake are back on, flush the block before connecting the radiator hoses to get the chunks and crap out of the cooling system so they dont get hung up in the radiator and cause the whole problem all over again.

For a hundred bucks and some time, you may recover that motor to a usable state. (I did one that looked just exactly like that once and got 90,000 more out of it after I did exactly what I described)

Obviously the better option would be to drop in a good running condition replacement motor, or have that one redone, but sometimes we gotta do what we gotta do.