My 1991 4WD Loyale stationwagon has been burning some oil for years, which doesn't appear to be a problem so long as I keep the oil level topped off. Recently, things have gotten worse. Now, the car is burning a lot of oil (clouds of smoke out of the exhaust when the engine is first started.) After the engine warms up, the engine appears to be burning less oil, but still burning oil.
Yesterday I did a compression test. Cylinders #1, #2, and #4 show about 140psi in a dry test and 160psi in a wet test. Cylinder #3, however, showed zero compression in both dry and wet tests. As far as I understand, this means either worn piston rings or an open valve.
1. Do you have suggestions on next diagnostic steps?
2. As this is my daily driver, is it safe to continue to drive this vehicle in its current condition? Or, should I park the thing until it's fixed?