Problems getting worse!

So I have been getting smoke from my Blazer when I start and can get large amounts if I rev high. Being colorblind myself, my roommate said the smoke was kind of blue, which means transmission, correct? I've check the intake vac hose, dry. Where else could fluid be coming from? My idle is getting much worse also. It's like it is skipping mutliple times, but keeps running. I've noticed fluid saturation around the gromets of the valve covers and fluid in the PVC valve, but the PVC still clicks when I shake it. What is going on!?!

How many miles are on it? How often do you change the oil? It sounds like blow by or bad valve seals. Pull the PCV valve and look down through the rocker cover and see if the top of the head looks gunked up. If it is you could be blocking the oil channels that drain the oil off the top of the head. If this is happening the oil will build up and then find its way around the valve stem and into the cylinder. You would get a rough idle.