1988 F150 Lariat - Oil Soaked Air Filter ??
 

1988 Ford F150 Lariat - 302 Eng, AC, PS, PB, PW

In doing the small work, oil change, general checks, etc....... I removed the large rectangular air filter, planning to replace it and the smaller filter located under it that has a hose attached leading to the engine.

That smaller air filter is completely oil soaked..... What would cause that? (Joe)

That smaller filter is supposed to be the intake inlet for the PCV system. Might be a good idea to replace the PCV valve.

I did pick one of those up along with the air filters etc. Strange though... the existing PCV valve is only a year old with not many miles on it, however even a new one could be faulty. I'll be changing it today. Thanks Hanky.

The small breather filter is supposed to be an system inlet as Hanky stated.
The crankcase should be maintained in a more 'vacuum' state if the PCV system is working spec 'and' if the engines crankcase gasses or blow-by don't 'exceed' what the PCV system can remove or process.

If the crankcase goes from a vacuum/flowing state to a pressurized condition do to to much pressure/blow-by or the PCV system isn't spec or affective, the crankcase pressures and oil vapor will back out of the breather and collect on the filter.

With the PCV functioning, remove the oil fill cap and place your hand palm flat or some use a thick piece of paper etc placed over the fill to check for crank vacuum. If running the engine up produces possitive pressures, ( other than on a throttle snap) that pressure and vapor will go out through the breather filter at some point.
If little to no vacuum is detected, cap the breather and recheck, vacuum at the oil fill should be easily felt (although not venting/flowing outside filtered air)
It's not uncommon for the breather to get a mist and debris over time and if higher mileage, but if it's soaked with oil, dripping would not be normal...

Just a little reminder,
Not all PCV valves are calibrated the same. Try to get the one specified for your particular engine year, size and model.

Hayapower & Hanky.... All of what you had to say makes perfect sense and I'll run that vacuum test as soon as i feel up to it. In the meantime, I'll put a few miles on the truck, and then inspect that small filter.

I do always advise the personnel at "Advance Auto" (previously "Discount Auto") of the make, model, engine, etc of the vehicle and watch the computer screen while they pick out the specific part I need to help avoid errors... so far, so good.

The truck, as of yesterday, has 100,568.0 miles on it. By the looks of the carbon I dug out of the intake manifold and a slightly rough idle, no doubt it needs a valve job... that I know I can't handle and will need to have that done elsewhere (got to be cheaper than a new rig. :)

The carbon buildup was so bad that the hole in the intake manifold (just the other side of the throttle butterflies that leads from one barrel to the other) was completely clogged.