Whats wrong if I see this?, is my engine bad? Options

[soulshadow]

Is my engine bad? This is like carbon dust, or something mixed with water.
Is this natural for a JDM type engine?

I only have a 2.5 high-flow cat and a 2.25 muffler with a 2.25 custom catback.

Before I got the catback and noticed this spray of black stuff, I did pour in the gas tank a bottle of treatment, but all this stuff is like "whoa wat the ****"

This stuff is like coming right out of the muffler when I rev the engine.
I dunno if my engine is bad, or not. Can someone explain?

[soulshadow]

OK, it seems that the ISCV (Idle speed control valve, sorry forgot to translate) was stuck or something. So I pulled out the unit and turned the thing a few times and I guess It became stuck free. Anyways, the car will idle fine now at around 900 RPM - 1K and after messing with the Dizzy.

Something I found intresting was that the Engine does not like to be advanced too far. Too far and it makes a very loud noise without much power. When its timed right, you can actually feel the torque on second gear.
So far, I'm not too sure but I'm guessing my engine is putting out 130-40 HP. I should probbaly get a dyno tho. The engine is amazing. I got a friend to ride with me today and he said the Speedometer just jumped like crazy!