Ooh Boy, i'm not sure I can handle all this stuff = where do I start.
Lanny - as long as this site has been around I think many on here would know if the Kohler for a "Case" tractor would mount in an IHCC, and whether it would have the correct crank diameter for the CC PTO, etc. Since it doesn't seem to have come up my guess would be it won't work. I think I'd head back in the direction of your original oil burning problem with the 1st engine. That oil is going some place from some place - and there are only so many possibilities. I'd still suggest starting again with the head off, rotating the engine to see if the valves open and close COMPLETELY, and also having a good look at the cylinder wall itself for something like a large scratch/scar/gouge (from something like a broken ring).
KenTUCK - red??? don't recall any.
Steve, Dave and Frank - #9 can only go one way BUT it has to be the right way. Yes of course the deep tubes go toward #8 but it does flip 180degrees and still have the deep tubes toward #8. I bet that's your problem. If you look closely I believe you will see the tubes are slightly offset one way to the other. Hope that fixes it.
Wayne - your guess is correct.
Jeff - ya gotta develope your "ole eagle eye" - something I'm known for. Here's a pic that might help you see it's NOT a 129. I know the pic I posted below might have been a little blurry so maybe this one will help
And NO I don't mean you need to count the cooling fins to see if there are 13 on the Kohler Block.
Maybe this pic will help - it's a "before" pic when I had removed the engine and a few other things BUT the key is - NOTICE the "169" decal. The 169 is the only Hydrostatic unit that IHCC did NOT identify as Hydrostatic in the decal just above the numbering. I don't have a camera handy but here are a couple more (old) pics that can help cross reference to ID the unit.
Hydro Harry
Old Cubs Never Die (especially old 169's) but they are often resurectted