What does you temp gauge read?
I'm no expert like some of the other guys on this forum...but I just did the head gasket (both sides) on my 92 (143K) and i did see a bit of reddening of the coolant, but my oil looked fine the whole time. My expansion tank did have some reddish crap in it as well. I kinda thought it was simply neglected as the car wasn't maintained very well by the previous owner. There was no skipping or engine noise at all....thing ran like a top..very smooth.
You might be able to test it by taking a coolant pressure tester and seeing if the pressure in the cooling system immedately starts to rise...As a fleet mechanic, I also seem to remember we had these little strips that would test for combustion reminiants in the coolant...
Anyway, with that kind of miles and the cast iron block/aluminum head deal on the 92/93's..I would think head gasket might be in order...I did it myself along with milling the heads, plugs, plug wires, full toyota gasket kit, O2 sensors, etc for about $1100 total..I also did both sides...
Good luck man..