I wouldnt have thought its anything to do with the block, do you have the stat in the correct way around?, have you over-filled the coolant?, are the plugs new or old ? as for the misfire did you erase all the old codes before starting the car after the rebuild? as they could be old codes.
As for the steam, these engines get very hot very quick, normally if there is to much coolant in there it will get it out on its own.
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