Sounds like it could be stem seals or worn valve guides. Under high vaccum it can pull a bit if oil through. I had it once on a very steep hill i coasted down, then a puff of smoke. Has never happened again. Valve guides seem to be a thing thats ignored when forging
I agree, its a good engine and makes sense in some cars, just not a starlet. EG swap etc would make sense and probably be easier. Starlet chassis will never be as good as a hondas, as much as its painful to say