Coolant level decreasing, Smoke from Exhaust after engine replacement and repair.

So I have a Chery QQ (CHINA) and 5 years ago I switched out its engine
with a DAEWOO TICO 0.8L Manual Carburetor Engine. All was running
good when recently the fuel pump stopped working and for some reason
the sensor did not turn on the Fuel Pressure indicator on the panel. The
engine ceased.

I was lucky enough to get the same engine (slightly used). On installation of
this engine two cylinders were not at pull pressure and turns out that two
Valves were bent. So we took off the head and put in new Valves, Valve
guides and valve seals and also replaced the Head Gasket. The ENGINE
condition from the INSIDE WAS CLEAN. Golden Engine no blackness or
carbon build up or anything. It was just like new.

When the car started the first time everything was perfect. EXTREMELY
SILENT engine, No vibration, no smoke.

On taking the car out drive was just perfect. Driving the car for about 30
Kilometers the Coolant level went down a little (like a decrease of 30
percent in the radiator bottle). We filled it up again and than again the
same thing happened. At this point I should mention that I used plain water
as the coolant. I have never in my life used anything else.

Anyways, I thought there could be a leak somewhere. Checked the engine
and the coolant wasn't getting in the engine.

Used the car for 3-4 days and everything was fine expect for the Coolant
level going down. My guess was a minor radiator leak.

Today when I started the car first time (Cold start) there was extreme
WHITE SMOKE from the exhaust with a strange smell. I checked the
engine oil and the oil was LOW. Checked below the car and there was NO
OIL LEAK. I filled up the oil again and started it up and drove for about 3
km and the smoke vanished. NO SMOKE NOW.

What's happening here? The water can't be entering the engine as new
Head Gasket was put in and its not mixing up with the oil.
Where did the oil go?  Oil level was at 70% when I filled it up. I did not fill it
up all the way. Could it be that the oil went in different parts of the engine
and that is why it was low and the smoke happened because of the low oil
level?

My initial guess is that it might be the Rings or the Valve seals? Really
stressed out right now.