Coolant leaking into 318 cylinder 8

Purchased a complete 318 long block remanufactured engine during COVID. Project got tabled for a while. Recently got to the point we were ready to fire the engine for the first time. Was about to install the intermediate shaft and distributor. Fortunately, we had the plugs out to make it easier to turn the engine by hand. While turning the engine, we noticed coolant coming out of the spark plug hole from cylinder 8.

Instantly starting thinking cracked head, torn head gasket, leaking intake manifold gasket - all the obvious possible things that it could be - and of course, cracked block. But this was a freshly machined block. Sent a borescope down the intake runner and into the cylinder - nothing visible. Intake is dry as a bone. Started assuming it had to be top end, so I pulled the top end apart. Could not find anything. Had the head tested. Tested perfect. So I reassembled, and hoped it was just the head gasket. Nope. Turned the engine and there is coolant in cylinder 8. Sent the borescope back in, and figured out that if you pull the piston all the way down, coolant starts running in from the bottom. Pull the cylinder up a little bit, and it stops. Coolant is entering from below the piston line. Best guess now is that the cylinder is cracked, but so deep in the hole, that it is below the rings until the very bottom of the stroke. Frustrating. Engine has never been run. I already checked all the obvious questions. No it is not weeping in from the exhaust hole. All intake bolts, and outer exhaust bolts were properly sealed. The engine passes a leakdown test when the cylinders are at TDC. The coolant is definitely coming from below.

Have already sourced another block, but it needs to be machined. Will be pulling the engine this weekend, and pulling the piston out of cylinder 8.

Here is a video of the inside of the cylinder. Most frustrating thing I have ever dealt with.