im hoping those pics ae before you gave it a clean!!!!!!!!!!!!!!!!
as for the bugz HAHAHAHAHAHAHA gotta admit thats pretty funny...
but with the block you did clean that didnt you? otherwise its gonna leak almost definately! get a scrapper and scrap it all and then some 600grit sand paper to smooth it out..
also while your there get a file and clean out some of the corrosion in the water jackets and remove the bottom water hose and flush that out a bit... you might as well since the heads off