You won't reach 600 with TBI but you could come close with Vortec heads and MPFI from 96-99 and an aggressive cam. Hey, if your rebuilding, you might as well go all the way. Make sure you use the upgraded Injector Spider from from 2003-2007. Although the 454 may have already had that in 96-99...
Oil can either come from the oil pressure sensor if not properly screwed in all the way or even under the distributor, if that gasket is gone. There is a gasket between the distributor and the intake manifold that is often overlooked.
Also the rear main seal may start to weep oil after 100,000...
Go with a new, more modern fuel injector spider. CSFI to MPFI conversion. The old ones had the poppets on the end of them which get fouled and tarnished by combustion. Then they either don't open or stay open which dumps more fuel into the cylinders then necessary. The newer spider actually has...