Just some quick thoughts. With the block being zero decked, is it possible the alignment dowels, if installed, are to tall to properly go into holes on head maybe bottoming out and not allowing the head and gasket to clamp up?
Take the head gasket and measure thickness right next to the dowel locations and compare to what it should be compressed or if you know what the unmolested thickness was. I've seen a set of ede heads where this occurred and the heads ended up cracked badly.
If you have the heads off, set it back on the block, sans gasket and see if you can slide a feeler gauge between head and deck. The head should sit on the deck, no clearance.
Water in all 8 likely isn't a cracked intake. That sounds like a head gasket sealing issue.