Blown head gasket. Do a compression test.

How does that lower water pressure?

We did look at the plugs and they all seem to be burning about the same, no
water in the oil and no pulses in the water jacket. Since this pressure ends up
below 60" of water (about 2PSI) I have been able to watch this with a precision
0-80 In/H2o guage. If I had a water to combustion leak I would expect to see
the guage bumping when that cylinder fired.
We have thought about a head gasket but I don't think they checked. I will ask.
Thanks