@town325i - How do I go about pressure testing it though? Never had this problem before you see so never needed to know.
@Brian -
How much oil is in the water? - Its full of very brown and thick looking oil.
How much water in the oil? - I have literally taken the cap of the rocker cover to look in and the bottom of the cap is the same as as the water tank consistancy, although not looked further into it.
Is the coolant level decreasing? - It was until yesterday, I checked over all the hoses and found a few of them not tightened at the jubilee clip, tightened them and now I see the oil in the water. (Could this be a way of disguising the oil by leaving the hoses loose so the water drains? If sold by someone trying to shift a motor with a suspected head gasket failure?)
Is the oil level increasing? - Just going to check and will edit this answer in a metr of moments.
---===EDIT===---
Checked the dip stick for the oil and it seems to to be the same level as before (About half way between the markers) and the oil seems to be fine, if a little brown. But nothing bad (still usuable), but I did run my finger on the inside end of the rocker cover cap and that is like a very creamy oil.
Also checked over the water tank again and the oil in there is very thick and running slowly and i tried to wipe it off my hand and back into the tank and it slowly dripped back down.
Also add, she has been idling at 500 rpm. She has a lose jubliee clip on the fuel hose connecting to the injectors, and is smokey more than my other e30's. White and smelly smoke if that helps.
