Oil in breather box

Okay so I just swapped my 04 rancher to 4×4. Today I went out to test the 4×4 (works great btw :D). I drove it for maybe an hour and then I checked the airbox, full of oil… Drained it, filled the motor back up to just below the upper line on dipstick, then went and rode it for another hour. Got back, check the oil. None on stick, all in breather box. There was also water in oil but I can’t figure out where it came in. It’s no grit in it tho, just iced coffee colored oil