Hi Jeremy,
1. When the engine is running, or not running, do you see the gasket leaking?
A. If yes, the head gasket is leaking.
B. If no, the head gasket is not leaking.
2. Next, if you find no water in the oil, & no bubbles showing up when the radiator cap is removed, good chances it is not leaking.
3. Why does the engine & head look like that?
Not enough trees to make enough paper to write down all of the guesses of why it looks like that.
Most of us have seen far worse paint jobs.
Hope this helps.