I just bought a 99 XLT 3.0L with 135k miles for my wife to drive to work and for us to haul stuff around on weekends if needed. I've noticed that besides the leaky valve covers, it appears to have a coolant leak. I was changing the plugs just as part of the first round of basic maintenance when I first noticed the coolant leak. I got the drivers side all changed without a problem and then pulled cyl 1 plug out and changed and then noticed coolant was dripping on the ground.

Doesn't seem to have come from the plug hole but more the back of the engine. It's dripping off the bottom of the bell housing. As I was looking around trying to find it's source, it managed to drain 1-2 inches from the reservoir over the course of an hour or so. Radiator is full.

The previous owner has clearly neglected the cooling system as a whole as there's a good little bit of rust collecting at the bottom of the reservoir and I see flecks floating in the radiator.

Any ideas on where it could be coming from?

Also, how big of a DIY job are the valve covers? I come from a decent mechanical background on air-cooled 2 strokes but this certainly is a bit different than what i'm used to.