'36 Ford pickup needs engine help....

[1936 ford pickup]

Hello,

I have a '36 Ford pickup with the 59AB engine. I removed the exhaust manifolds to have repainted and noticed water in the passenger side exhaust manifold. I checked oil dipstick and water was present. I checked the radiator and oil was present. I drained the oil and water was present. I pulled the spark plugs and #2 cylinder plug was fouled and all carboned up. All other cylinders with their spark plugs were clean and dry and no carbon buildup. I shined a flashlight in all spark plug holes and only #2 plug hole showed carbon buildup and what appeared to be small amount of rusty water. I did a compression test on all cylinders and here are my findings.
#1....100 lbs
#2....70 lbs (with fouled plug and carbon buildup)
#3....100 lbs
#4....90 lbs
#5....130 lbs
#6....125 lbs
#7....115 lbs
#8....65 lbs
Do you think a head gasket replacement is in order for both sides and what would cause #8 to be low compression compared to the rest (I rechecked twice #8 compression and same results).
Before all this, pickup started right up, never over heated and seemed to run fine.

Any comments and help is greatly appreciated.
THANK YOU,

Bruce in Ca.