GM-GMC: gmc truck deisel quit on highway in puff of white smoke, 2 quarts, head gasket

Question
My 94 GMC crew cab  6.5 diesel pulled a trailer of about 5,000 lbs from MO to NC through the mountains without overheating.  It uses oil and I put in 2 quarts in 1200 miles. The morning before when we climbed 5 miles out of Cookeville, Tenn.,we geared down to 2nd and were only going 30mph and the temp went to 220 before surmounting the last grade after which it cooled right down to 160.  It runs on the straight at 180.  Another days driving with no problems about 50 miles from my home as I was passing going 65 mph, I lost power and a puff of white smoke came out.  It stopped and would not start just like I was out of gas.  I checked the oil and again in an hour and indeed the next day and the dip stick was covered.  The mechanic suspects that there is fuel in the oil, but says he needs to start it to find out what is wrong.  So far he cannot start it and he has had it for about 3 days. When he introduces fuel it starts for a minute then dies.  I had heard that it is very bad for the engine to run with fuel in the gas.  Why would there be fuel suddenly in the gas?  The assumption that it is the fuel pump rather than the injector pump doesn't seem to answer this question. So actually 2 questions?  What do you think it could be? and Will starting it with fuel in oil destroy engine?

Answer
I am not a diesel tech by any means.  However, if your oil is diluted too much it looses its lubricating qualities.  I would drain and refill if it is diluted that much before trying to get it to run.  The other thing that has me wondering is the white smoke.  That is a telltale sign of a head gasket concern and if I remember correctly those engines were prone to cracked cylinder heads and headgasket problems.  I would ensure you don't have a head gasket or any coolant entering your cylinders before you start it.  Aside from that general advice I can't help too much with diesel diagnosis.
Hope that helps.