QLLR400

i am getting a rebuilt 4.6L 2v next week cuz i cracked a piston on my old motor. i have a vortech supercharger with a bullitt intake thats going to be put on it as well. one of the things i noticed when i pulled off my valve covers of the old motor, was that there was a yellow mustard-like substance EVERYWHERE. i talked to a local shop and they said that it happened because moisture was getting in there, and it was mixing with the oil. ive heard about oil seperators, but if i get them, what EXACTLY will they do (or are supposed to do) and can i install one on the passenger AND drivers side?