E60: Bad Oil Leak - was it running too well after rebuild?!

I've covered 125 miles on the new head / ground piston since putting the engine back together last weekend and the car has performed great. However, I was checking the oil and finding it hardly showing on the dipstick. On Wednesday night I poured in another half litre of oil and it began to show on the dipstick, about one third up. It was in the same place the following morning, so I poured in another half litre, got it up to near max on the dipstick and carried on using the car. Almost immediately I could smell fresh oil from the heater / air-con. There had been no dropped oil for the first few days [engine under-trays still off], but there sure was now. A small patch every time I pulled up and stopped the engine. Some investigation revealed no oil to be leaking while the engine is cold, but once up to temp. it is a constant drip from underneath the turbo area and a few drips from elsewhere, mainly from oil running along the sway-bar and cross-members. Oil is also ending up in the air-intake and being burned by the engine. This is not good!

This was after running the engine for 2 minutes on a fresh piece of newspaper!

Here is where the bulk of it is coming from - the turbo oil-feed pipe. It may also be from the oil-return pipe, located under the turbo. Hopefully this is too much oil or oil-pressure finding its way out through the loosest seals. If not, the turbo seals have gone and the blower is on its way out.

Oil is flying into the air-intake also, so the injector tips have become quite cruddy with oily residue. Nasty, though the nozzles remain quite clean and all 6 appear to be working OK.

This is the breakdown:

• Simply an overfill - oil-pressure is too high and leaking from multiple loose seals.
• Turbo oil-seal gone - oil is gushing from the middle of the turbo and getting into the inlet.
• Blocked CCV - the crankcase can't breathe is causing high oil-pressure and leaks.
• Complete turbo failure - bits of swirl-flap unbalanced the exhaust-wheel and wrecked the spindle, oil is now leaking from the centre-bearing and the blower is finished. 

There is a little bit of lateral play in the spindle, so that horrible last option could be the case, but at least a re-con turbo is only £325 on eBay, not too bad. Hopefully it's the first option and dropping some oil back out of this thing could cut the leak right back. Oil getting into my inlet is not good news for a diesel though and I could end up with my engine running on its own oil and unable to turn off, at which point I hope there is enough room in the traffic to stall the motor out!

My plan of action is thus:

• Drain 2 litres of oil back out. [I can always put more back in.]
• Watch for blue-smoke developing. [None as yet, but a bit of white smoke on startup.]
• Get someone at work to check play in the turbo-spindle. [They say it's passable and a leaky turbo would give bad smoke, a broken one would be noticeable.]
• Replace CCV [crankcase-ventilator]. [eBay £37.50 delivered.]
• Replace oil-filter. [Euro Car Parts £5.99.]
• Replace copper-washers on turbo oil-feed pipe.
• Replace turbo... gulp.