I would change oil and filter, first thing. This will allow you to see if
water really is getting in the oil. Next, nothing you said but the clouded
oil and too high level would really point to a blown head gasket or cracked
block. I would save that thought on the back burner and start with new oil
and go to the river and motor around a bit staying close to the landing and
keep an eye on the temp. gage. Afterward , I would check the new oil for
water (cloudy?) and pull the plugs and see if old #4 looks weird. If there
is water entering that cylinder it should make that plug cleaner. Also spin
it over like you did before, without plugs, and see if you get any water. A
little river running under a load should make a suspected leak more
noticable. I hope your charmed motor stays that way.

--
Ron White
Boat building web address is
www.concentric.net/~knotreel