first you need to find out if it really is oil inthe rad.
many times a blown head hasket will let oily residue from combustion into the rad.. over time it makes a sheel and can emulsify into a layer that sets on top after water flow stops.
that is quite common and can usually be detected with a compression test and leakdown test, and then a head gasket change if indicated.
there are no oil ports in the head.. so.. if it ruly is oil.. that means block issues.. and I'd look for water int he oil.. however.. keep in mind oil ressure is usually (hopefully) higher than the psi rating onthe rad cap.. so real oil in the water, but no water in the oil is still a possibility.. though with the engine pan off and a leak down tester.. you could find it.
i'd do a comp test.. and then flusht he rad with a commercial flush product to cut the oil.. then refill with water and see what happens... if comp test indicates blown hg.. then repalce as indicated.. etc.
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