Chevrolet: 1999 tahoe 350, mobil 1 synthetic oil, head gasket

Question
My son has a 99 tahoe with vortec 350. It locked up on him and I am trying to diagnose the cause. I think we have a water problem but not sure. When I pulled the oil pan the oil looks like jello. First time for me to see this! Looks like #5 rod is bent. He runs Mobil 1 synthetic oil and is good at changing it. I am trying to find the cheap way out so he can dump this thing on a trade. And why the oil got like this? Any suggestions? Thanks  

Answer
If there is a white sludge in the oil then there is either coolant or water in the oil. Coolant from a bad head gasket or water from your son driving through deep water and the intake sucking up water.

If the rod is bent, I would think the latter happened. The rod would only bend from being hydrolocked. Pull the spark plugs and see if any water comes out.

Cheapest way: Buy a 350 V8 off ebay or a local wrecker and drop it in.

The motor he has in the tahoe right now is toast and would cost too much to repair.