Okay guys I'll give you a brief update on how the car is going. I have been advised that I should stop opening the radiator cap when the engine is hot and/or running, that I should just keep an eye on the temperature and water level (when cool). Well the temperature is fine, never above 180*F, and the radiator level has remained constant so far. Still no signs of oil in the coolant or vice versa. Next step is put coolant in as I'm just running water at the moment (and it's a tad on the orange side!)
About four different people today suggested that maybe the frothing was actually caused by cavitation. Don't know how you could check if that was really the case though. Anyway, it doesn't froth anymore, since I've stopped opening the cap when the engine is hot!
Oh and Kev, you were right re 998 heads. It has more torque but FA top end, doesn't go much beyond five grand now!
Anto.