The oil rings might be stuck? But seeing carbon on the backside of intake valves makes me think a valve job might fix the problem. I'm not familiar with the poly, but could an intake gasket leak be sucking oil into the cylinder? Bad pcv valve?
Must be. 66 was the last year for US cars, 67 was the last year for Poly's in Canadian built cars. Good engine. This one just needs some freshening up.
