Did you measure the cylinder and check piston to cylinder clearance, and ring end gap at least? Not measuring and just putting things together is bad news. If not, during teadown, follow the manuals motor specifications to ensure all the tolerances are correct, and nothing is worn. Also, gas in the oil could occur from a worn needle and seat in the carb. If you leave the petcock on "ON" and the nedle and seat are worn, fuel can pass by them, and keep filling until it has no where else to go, and finds its way into the oil. The needle and seat can be checked visually, or more effective is a very low pressure test. If you have any doubts, replace. Good luck, and hope this helps.
THE 80's RAGE! Currently owns:
81, 85 Yamaha Tri Moto 125
83 Yamaha Tri Moto 200 x2
82,83 Yamaha Tri Moto 175 project
85 Yamaha Tri Z 250
84 Kawasaki Tecate 250
84 Honda ATC 70
85 Honda ATC 350X
84 Honda ATC 250R
(2) 84 Honda ATC 200x
82, 83 Honda ATC 185s
81 ATC 200
Lots of other parts and bikes