Yes, I think this really was a bad head gasket and/or head bolts. There was tons of watery snot up in the valve covers (worse on one side), indicative of the leak. The heads checked out fine under magnaflux.
So really I had two problems (head gasket/bolts and corroded freeze plug), and luckily both got fixed.
Yup,with the age on that 6.9 and coolant in the oil, the head gaskets needed to be changed. Same thing with my '86 6.9. I also went with ARP studs. I too run a filter with DCA, never hurts to have insurance against cavitation, even on a 6.9.
Great to hear you found the problem. That's a 1st for slow coolant loss. Gary (icanfixall) had a freeze plug failure, but it was catastrophic and sudden. Glad to know you got it shut down before any serious damage was done.
Heath