Oil that turns black quickly normally indicates excessive blow-by past the rings. However, David's problem seems to be raw oil getting into the exhaust system, not oil that has been burned in the combustion process.
Here's my thoughts about what is happening to David's motor.
First, the only way oil can get into the exhaust system downstream of the combustion chamber is via the exhaust valve guides. The Blue Thunder heads on David's motor do not have an exhaust cross-over, so a leak there is not possible. Some mechanics do not believe exhaust valve guide seals are necessary, and they asemble the motor without them. I have a suspicion this might be the case here.
At low rpm, I believe the exhaust is blowing up the guides, and getting into the rocker arm/ valve spring area of the heads, polluting the motor's oil. Then, at higher sustained rpm, the high velocity exhaust gas flowing past the exhaust valve guides is creating a venturi effect, drawing oil down the guides and into the exhaust system.
cowboy from hell
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