Yes start with the heads and gaskets if your lucky its that simple.
Has the engine block been bored over sized without being sonic tested?
I had the same problem hoping it was the heads.
IF the heads check out good, after you get it put back together without installing any more parts that you have to to seal up the water ports fill the radiator with water leave the spark plugs and drain plug out of the oil pan. put a coolant system pressure tester on the radiator and pump the thing up.
I would have saved about 8 hours if I had done this the "first time"
I was chasing a broken block. When I tested this way the 2nd time, water ran out the drain plug and when I hit the started whoosh came the water from # 1
![](/ubbthreads/images/graemlins/eyes.gif)
Cracked block...
![](/ubbthreads/images/graemlins/bawling.gif)