Took both heads over to the machine shop today and needless to say I wasn't there long, the guy took one look at the exhaust valves and knew they were all bad. They did test it for leaks using two magnets and some fine metal powder like stuff. never seen anything like that done before. Basically all the exhaust valve seats are bad and they did confirm what I discovered about the Intake Valve on Cylinder 3 having a leak as well.
that sounds like magna fluxing. the powder is magnetic and will show cracks.
I have heard about the FelPro gaskets being somewhat forgiving but even still i'm concerned about it not holding up more then maybe 50K miles, from what I can tell from closer examination of the OEM Gasket it was on the road to failing.. Fortunatley the fire ring areas on the block all look good so theres that..

