Hello Deerhunter30,
It is always hard to visualize a pollution control system that has been modified, but I will try to give what information I can.
First, here is how the hoses of your 83 Jeep’s pollution control system were configured when the Jeep left Toledo.
(Note: I know this is a big picture in terms of bytes and screen dimensions, but the picture needs to be large for legibility.)
Originally, your Pollution Control Valve (PCV) system consisted of two hoses, an air cleaning housing filter element and the PC-Valve. The PCV was inserted into a rubber grommet in the valve cover at the FRONT of the engine. The rubber hose from the end of the PCV led back to a source of manifold vacuum at the base of the carb. The other hose attached to the small filter element in the air cleaner box and then led back to a hose fitting which sat in a rubber grommet at the back end of the valve cover.
See diagram, above.
So…fresh air gozinta the engine through the air cleaner filter, through the hose, into the back end of the valve cover, bounces around inside of the engine for a while, then gets sucked out of the engine by manifold vacuum, through the PCV and the attached hose into the base of the carb, to burned in the combustion process.
(How’s that for a run-on sentence?)
That was how things were supposed to work.
The air coming out of the engine will naturally be laden with oil vapor and combustion byproducts because of the inevitable blow-by. Those oily vapors are likely collecting in your K&N breather and condensing back to a liquid upon cooling.
To cure that, I would put the PCV valve back in the front end of the valve cover and connect the PCV to a source of manifold vacuum at the base of the carb. Then move that K&N breather-filter element to the back end of the engine so it filters fresh air going INTO the engine, instead of the oily air coming OUT of the engine.
If that does not stop the oil suction, I would suggest a cylinder compression check. You might have have a case of excessive blow-by, which is forcing an excessive amount of oil out of the engine.
I hope the above proves helpful.
Gadget