My take on the oiling system crossover tube for the small block

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From the quick flash of the video camera You did not need to do the set screw and plug on the number one Passage. You could have gone through that water jacket hole tap the hole and put a plug in it and still been able to use that block as originally intended.

The plugs at the end of The Galley at the front cover are not to separate water from the oil those are to keep oil from leaking out the end of the galley into the front cover area.

I would really like to see more of your video on the third main passage being drilled out it may not be as bad as you think.
Do me a favor and slow the movement of the camera so that I can get a better view of things.
Remember I'm very old.

Ok, I gotcha on the expansion plug behind the cam plate.
By pushing the plug into the galley deeper it stops oil from going down to the main journal on that tappet galley.
Oil inside the passage will be dead-headed between the inside plug and the outside plug behind the cam plate.

I drilled into the water passage on #1 so I had to put a set screw in the main journal area to keep water from going to the main or oil from going into the water passage (60 psi overpowers 15psi).

By pushing the plug in deeper this means no oil from the galley could escape down the oil passage toward main and out the hole that was drilled into water passage.
All good there.

#3 is a different story.

Just plugging the water passage hole at the deck would do nothing for stopping the oil going from the right oil galley out into the water jacket on it's way down to the main journal.
I see no way to separate the two unless the block was filled to the top and all the oil passages to the head were drilled and plugged with an exception of the ones coming from/to the pump at the front. A tube or something would have to be placed in there to allow water to flow to the heads.

Unless one wanted to set up an entirely external water cooling system to feed the heads.
What a PITA!