How are YOU going to know what is wrong by tearing the engine down??? The problem should be diagnosed first.
Have you ever reassembled an engine??? Do you know the proper torque specs and sequences????

It needs a compression first. If the comp test does not show anything, then do leak down test on all cylinders.

Yes I have extensive knowledge of how to tear down and rebuild engines, this isn't my first rodeo with engines (cars, motorcycles, and boats)!! I will do my own compression test and leak down test as a start (service has said compression good, leak down on #1 and #8 (only two tested) was bad. I have a few more things I am planning on doing to this engine, and it will all be easier to work on setting on the stand instead of standing on my head in the boat.

Standing on your head in the engine bay does suck. One other thing ya might check while doing that compression test is pop the valve covers off and observe the rocker lift. Have seen some wiped camshaft lobes before that were hard to diagnose because everything else checked out.

Did you get the engine apart? Find anything out of place?

Engine is out, trying to clean a spot in my cluttered garage to be able to work on it. This weekend is the time for it to have the tests ran on it and make a decision on what to do. The way it ran this past summer (I just picked it up in June) I'm leaning on some kind of valve issue with the leakage. If it is more than head work needed, I'll add up all of the parts needed and get the engine guy next to my shop to work me up a price for block and head work and then make my decision. I have found an engine from US Engines out of Washington that sounds like a good swap (454 420hp and more torque for $3500.00). I'll keep this block and rebuild it as time and money comes available for a spare or to put in a boat that my son wants to buy. I'll post my findings sometime this weekend.

Have you googled us engines?? If you really have a desire to throw away $3500, please send it my way. Either way you will be out $3500, but if you give the money to tem you will just end up frustrated, mad, stressed out etc... however if you send that same money to me, at least I will take you for a boat ride and buy you lunch next time your around Toledo.

I have spoken with them on the phone (US Engines that is), I take it you have other opinions about them? I have delt with RapidO marine in the past but US engines had the best price and HP/torque ratings for the money is why I was leaning that way

Just did a search and didn't like what I was reading!!!!! Thanks for the heads up.

They have 'reinvented' themselves several times. one of the key things to look for is the 7 year warrenty. Also look for these wonderfull warrenties that have so many clauses to it that if you so much as look at the motor the warrenty is void

I'm thinking now after doing some more extensive research, I'm going to find out what's wrong with the engine I have and just buy the parts and have my shop do the machine work (then I can mic everything before assembly) and reassemble the engine with what I want to put in it, that way I know what's what. If I go with a little bigger cam or free flowing heads then I can send the specs in on all the changes with my computer and have it reflashed. Thank goodness this is at the end of the season and not half way through one.

If you are going to replace the cam I would suggest going with an entire valvetrain kit(cam, lifters, springs, rocker arms, retainers, & keepers) That way everything is designed to work together. Figure out what exhaust & what not to make reflashing the ecm easier. Randy