Normal for oil to crawl up turbo outlet?
 

I have my turbo disconnected from the intake as of the moment... testing the engine at high idle... I can see oil crawling up the tube, breather tube also disconnected, no apparent bearing play. Is this normal? Engine not up to temp yet if that matters.

Sounds like you need to rebuild the turbo.

If it's a sure sign of a need to rebuild I will. What amount of oil is acceptable? Or should there be ZERO oil present at the outlet?

And yeah... checked the axial play... there is a wee bit of up/down/left/right play...

Just wondering... since my turbo is not connected to the intake... it is vented into atmosphere... there really isn't any pressure AT ALL inside the turbo, so could this be why oil is snaking up out the turbo? Maybe the oil will lessen once there is pressure inside the turbo. Opinions? I'm just pondering posibilities coz I 'd like to avoid a rebuild if it isn't really necessary at this point.

I've never seen any reference to this particular issue on the forum in the 11 years I've been on here. You may be the first person to look down that tube with the engine running. There have been a number of cases in which the dipstick has blown out and oil has been expelled all over the engine compartment so I'm thinking that it's not unusual for oil to creep up all three tubes---dip, turbo and separator. How much oil is in the crankcase and does it make a difference if you remove the oil fill cap? Have you looked to see if it is climbing up the dipstick tube also?

Does the turbo tube have a check valve on it? If it does, maybe it's not working.

up/down/left/right play is normal, the turbo has sleeve bearings. in/out play is not normal, and should be rebuilt if it's present!
if the oil is minimal, and creeping around inside the housing, it could just be from blowby left over in there. if it's a stream of oil, then yeah that's a problem.
you could spray brake cleaner in there and clean it all out.( BE CAREFUL NOT TO GET IT IN THE INTAKE OF THE ENGINE!!!!! this can lead to a massive runaway/explosion of the engine situation!!!

Take the housing off(only 6 bolts), clean it up, put it back on and see if you still have oil running around. If so, it's a leaking turbo seal and you will want to keep an eye on it. Like vstech said, it can cause a runaway if it leaks too much.

There is absolutely no fore/aft play. ANd no oil snaking up the dipstick. In fact I think the engine is in good condition. There is not much coming out of the breather hose(also vented to atmosphere), unlike my previous very reliable 603. And it starts right up even without glow plug assist. (warm engine)
The oil isn't puking out the turbo even when revving hard, you'll just know it's there because oil pools at the mouth flange and eventually get blown off, scattering small oil droplets within the area.

The turbo outlet is pretty clean, it's not gunked up in any way, and doesn't look oil soaked.

What's a more reliable way to tell if the turbo needs a rebuild? Connect it and just watch my oil consumption and tailpipe activity?

Oil at the turbo outlet (or intake inlet) is just a sign that either the bearing/bushing and/or seals are worn in the turbo. Oil is pumped (under pressure) into the center section of the turbo housing and if one of those is worn, then oil gets by the seals. I usually have a little bit of oil on the outlet when I remove the intake "u-tube". My engine/turbo has 200k+ miles on it (also ~1/16" of play left/right/up/down) so I'm not concerned... it generally doesn't burn that much oil.

I would just hook up a boost gauge to the intake, verify full boost (in 3rd gear, 3k RPM, full load, full throttle) to be around 8-12 psi. If the car doesn't burn too much oil, then don't worry about it. If your anal then rebuild the turbo.

Thanks, I'll be hooking it up, will just see gauge how the oil consumption fares.