Water in oil pan

Your choices are: incorrect head gaskets (or incorrectly installed gaskets, no offense), cracked head, or cracked block. Might want to check if intake gaskets are okay too. Check your water pump/timing cover gasket too, and if I recall correctly the Magnum v8 (if you have one of those) has an intake plenum/pan cover that can warp under high heat - it often gets blamed for vacuum leaks in the pan but couple that with a leaky intake gasket you could get coolant in there as well. Good luck.

Update: the water in the oil pan was residual from before the head job. It stopped dripping, I filled the radiator completely and walked away for a while and none of it left the radiator and nothing came out of the oil pan. I've ran 2 cycles of oil/filter and plan to do a third tomorrow to work all remaining water out of the oil system, but there is a fairly strong "ping" I guess Id call it, coming from the valve covers. Just looking for additional opinions, is it just that the heads, rockers, and lifters are new and need more idle time to get fully lubed(I did lather everything with clean oil before installing valve covers) or is there something else that might be wrong?

Check timing to make sure that isn't causing the pinging. Since the valve train is all new, you want to change oil after a break in period, technically they do make an oil specifically for breaking in a new engine, however that is mostly for the bottom end not top end.When you do change it check for shiny particles, ie metal bits in the old oil. Hopefully your short block didn't suffer any damage from the coolant contamination. You could have pre-primed the oil pump when installing the heads but that is a moot point now as you've already ran the engine, so the oil pressure should have taken care of that by now. You can always run an oil pressure test, as well as check engine vacuum, you can even pressure test the cooling system to ensure it's no longer leaking.

Im doing a third cycle of oil and filter now since the new heads went in and adding a quart of Lucas oil. Ill double check timing as well. Thanks for your input.