Do a leak down test on her, & go from there . You stated rear pipe had a little oil inside of it. Seems to have good compression . Winter will be along, before you know it & you can resolve any issues you may find. If not fouling plugs with oil, keep a close eye on your oil level & enjoy. Don't hold much stock in what you were told by your Indy.
Ride Safe,
Harold

 

Never mind

 

I know synthetic oil found every oil leak I had in my 5.0 an started some more.

 

I just read through your thread from the start.

Every thing you wrote screams bad rings to me.

 

it does sound like valve seals or blow by,none coming from carb?
im wondering about the rear valve guide its self, since your compression test is so close
and its only out of 1 cyl i would look into what the re manufacture did to the motor for rebuilding, there should be a list from factory for each serial number, as for a "whats been done to it"
over sized pistons,new valves /guides /rocker arms ect.....

 

Never mind

 

There isn't any coming out the carb, at least I'm pretty sure there isn't. This bike still has the crankcase breather going to the intake. I can see a very slight bit of residue at the breather, but nothing like what is coming out the exhaust.

 

If compression is good I would think rings and valve guides are fine. What are we missing?

 

Never mind

 

Yep, that is the old school confirmation for bad rings. Squirt oil in the cyl and if the compression increases, it's a sure sign that the rings are bad. Heck I'm wondering if you drained the oil, pulled both plugs, and run the starter for a few seconds would clear any oil out of the cylinders? Dang, where's Dr Hess when you need him...