Ol' Smokey the turbo

[jns]

My garage and house are filled with smoke as we speak. I put a new engine in my 87 Turbo and I'm getting smoke from hell. I suspected the turbo so took it off and ran the engine. Just got black smoke from running rich, that's another topic, and no blue smoke. The turbo has no shaft play and was supposedly rebuilt. I ran the engine disconnected from the turbo and sat the turbo to the side with the oil line connected. No leaking, though. WTF is going on? Do the oil seal ring ends have to be oriented up so it won't leak or could the turbo be leaking when it's connected to the engine and the turbine might be sucking the oil through the seal? Please help. Sorry this is so long....