get something like KB knock'r loose.... and spray the whole thing done a few times, its a penetrating oil made for breaking loose frozen bolts, works better than anything else i've ever used, it melts rust, and also it soaks into metal pretty well, i used it to treat a block i've got stored..... and the block still looks just as clean as it did after i baked and blasted it..... i know you're tight on money, but i would recommend a re-ring and a hone, it'll cost about $200-$250 and at least you'll know your bearings, rings and gaskets are all new and fresh, just make sure to keep everything organized, as long as each liften, rocker, and pushrod, piston and connecting rod goes back in the same spot, you should have any problems