[Dave at Pelican Parts]

Air coming out of the intake probably means that #3 intake valve is having a big problem.

JJ Slowik, on the Porschelist e-mail, suggested pulling off the valve cover on that side to look at the rocker arms. One time I dropped a valve seat, that showed me that something was very wrong. The other time, I only figured it out after I had taken the head off of the motor. (Saw damage in the surface of the combustion chamber, saw light around the sealing surface of the valve.)

Carefully examine the valve stems (etc.) for cylinder #3. Check for debris stuck in between the rocker arm and the valve, check for anything fishy with the rocker arms, springs, pushrods, etc. Get a magnet and pull the lifters out of the case. You'll need to remove the pushrod tubes to do that with the engine in the car.

If nothing is visibly wrong, then your problem is inside the motor. It will be time to tear it down. If the engine has anything close to 100K miles on it since the last major overhaul, it might be worth going into the bottom end as well. Ditto if your oil pressure isn't all that it could be.

Sorry to be the bearer of bad news.

--DD