1997 Saturn Sc1 has presented a "Chocolate Milkshake" like substance in the surge tank for the radiator, indicating that there is oil mixing with the coolant. The engine oil, however, does not show any signs of coolant contamination but will drain itself out (into the coolant). This is caused by a cracked cylinder head in the camshaft journals between the #3 and #4 cylinder. This is a well documented problem for 1995-1999 Saturns (all models) with SOHC engines.

Saturn refuses to work with its customers to resolve the issue. Please reference Saturn Technical Service Bulletin 96-T-65B when dealing with a dealership or Saturn directly on this problem. It states the problem in very specific details. This is caused, I'm told by a casting defect on the head for the SOHC engines from 95-99. Saturn acknowledges the problem, but will not recall/fix.

Update from Jun 13, 2009: This is the inside of the valve cover - Note the foamy oil and coolant mix that was getting thrown around inside.

With the Valve cover removed, you can see the relative difference in color between the 3rd and 4th cylinder and the 1st and 2nd cylinder.

After removal of the head you can see how polluted the 4th cylinder is due to the head being filled with the "Chocolate Milkshake" substance of Oil and Coolant mixed together. This is due to the oil and coolant going back through the water pump and eventually gumming up the entire coolant system.