Liquid poured out of Exhaust can

Just bought an 05 Rev 800 HO and it was blowing liquid out of the exhaust. Took the can off and literally poured a milky looking (Oil/gas???) mixture out of the can. There was some residual in the pipe and the looked like some in the Y pipe as well. Sled has not been run since last year and I am not sure how the last owner summerized it. Could this be a fog he put in last fall? I have only run the sled at idle or just enough to turn the track a few times so I guess it could be unburnt fuel loaded up but the can was 1/2 full with the stuff. Any ideas???

It is low on coolant but not bad. The liquid seemed like it was coming out of the clutch side cylinder when I looked in the Y pipe. Any way to test it there is a leak in either gasket?