kdub
Most likely to be the water pump shaft and seal. However water runs from barrel, through crank cases and into pump on these. So it could also be base gasket or crankcase to clutch cover gasket.
Never really heard of many water in oil problems with these. Give Nigel Birkett (the importer) a ring on 01229 716806. He is very helpfull and has worked on these engines since they were in Yamaha TYZ's. He will also send you and parts you need and runs a very slick parts service.
Maybee you should have kept the Gasser.
Please post what you find for others.
Wobbly