Any suggestions on where to start?
The cheapest and easiest things first. A compression test to see the overall condition of the engine. It wouldn't be difficult to pressure test the engine. Also a leakdown test.
Where else could the water be coming from? Exhaust?
These can help you pinpoint the source before you really start tearing into the engine and spending big money.
It is better to have a direction and not just throw money at it.