Since I never had an FE apart myself, I been studying these pictures and the sequence of events that you described. The
oil drain back holes at the four corners of the heads is very close to the water ports. Also one of the intake bolts is close to that area. If there is a crack in that area, torquing the intake bolts might aggravate it. Look hard it that area.
Pull the water pump. Block off the water pump ports and the head ports, and pressure test at a reasonable pressure. I would think 25 psi would be enough. I bet I doesn't hold.
CDNUS has an excellent point on water can be seen. You could fill it up with water and then pressurize it with the bottle. You might see it that way if the leak is up top.
If it is the head gasket leaking into the
oil that flows up to the rockers, it could only leak water in when the
oil pressure is less than the water pressure. Like when the engine is off. Therefore it makes sense that at high rpm (high oil pressure) it is pumping oil into the water. Check the water for oil.