No - fuel in the oil can/will CAUSE a spun bearing if you run it like that. Change the oil.
Flooded cyls come from several things:
1) Leaking injector O-rings - pull the fuel rail off with the lines and harness still attached. Turn the key to RUN and you should not see any fuel leaking or dripping from the injectors. Now crank the engine - you should see puffs of fuel from all 4 injectors at the same time. If you have dripping, check / change the 2 O-rings on each injector. They are dirt cheap from the dealer or
http://www.courtesyparts.com One O-ring is from 240SX KA24DE, the other is from Z32 1993 300XZ.
2) Timing too far off to run. Recheck the CAS timing and the timing chain if you had it off. It is so easy to get this wrong - off by several teeth; CAS 180 degrees off; CAS off by several teeth. Use the FSM steps and do not skip any - if you skip a step because you cannot get your engine to match the instruction THERE IS YOUR PROBLEM!
Remember once the engine is flooded it will not start. You have to dry out the cyls by removing the plugs and use a hair dryer. If you do this, then try to start and it floods again, you have to dry them out again.
Good luck!