My first 740 was an '89 and I too had the problem of the dipstick being pushed out a few inches. I assumed it was because of crankcase pressure.

I cleaned the flame trap as well as the oil separator, but the problem persisted. I noticed there was an Oring on the dipstick and realized it was not providing an resistance when I pushed the dipstick all the way in. I replaced the Oring and the problem was solved.

With the car at idle remove the oil filler cap and see if a piece of letter paper will be pulled down over the opening by the vacuum that should be present in the system. If the paper is sucked down on the opening I think you are good to go.

Randy
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Any twenty minute job is just a broken bolt away from a three day ordeal