2ND GEN 3SGTE help! Fried Piston Rings?

[gt4man722]

Heres the scenario.Just bought my first turbo car.A st202 with a second gen 3sgte.Lately
i started the car and noticed it idling roughly with a slight mis-fire.My mechanic told me the ignition
leads were the problem, replaced them with NGK's and the spark plugs also.The car is still idling rough
although slightly better.He was confused he pulled out the spark plug lead boot in one of the cylinders and noticed new plug was fouled with some liquid around it.The previous owner told me he just recently rebuild the engine!
I dont want to think one of my pistons rings fried!I hardly step on the gas when driving.Also the hood has no
shield underneath so water goes into the engine bay through the vent(the previous owner changed to a GT4 hood).Could
it be water sipping in to the cylinders through the boots?Also if the rings are fried how much would it take to rebuild in terms of rebuild kit etc??Could i be missing something?Also when u rev the engine at idle a puff of blue smoke come out of the exhaust.Thanks!

[MR2Jedi]

Run a compression check.
Did the previous owner provide any paperwork proving the engine was rebuilt?

Even if water got past sparkplug boot, it shouldn't get by the spark plug and into the combustion chamber .
What kind of liquid was on the fouled plug? Oil, fuel or coolant?

I would suspect a valve seal before a bad ring.