Help needed with sb 318

Is this engine in a vehicle?
#1, if the freeze plugs you replaced was cocked full of rusted dry gunk I would pull as may freeze plugs you can get to and fish a coat hanger wire or something to bust all that loose and get as much as you can out of there and run a garden hose though the top to wash it all out. Also if those plugs were rusted out the others are not far behind.

#2, Most 318 car engines hold 5 qts, some truck engines do hold more. Looks like a rear sump truck pan to me, but maybe not. Don't really know what to tell ya on the dip stick other than it might be catching something like you said. Have to tear it apart and check it out !!!! No telling what may have been done to an old car and or engine.