Common head gasket failure. It does not cause any damage to the bottom end. I bought my car with the same problem. Did the head gasket and all the tune-up items while I was in there and the car still runs great, nearly 4 years and 60,000 miles later.
My car still had full cylinder wall cross-hatching at 120K, walls looked brand new. The bottom end should be good for 400K+ before needing to be refreshed, if the rest of the car can make it that far!