Blue smoke is oil being burned and black is where the mixture is too rich.
The blue smoke could be from excessive oil level, allthough it would have to be silly high.
Other causes could be worn bores, worn/broken rings, worn valve stem oil seals or a failed head gasket.
A compression test would give you a good idea which end is at fault top or bottom or neither.
Thats put the spanner in the works annit.
Is there any sign of the axle hitting the sump?.
You need a minimum amount of oil to maintain level at the pickup strainer and to absorb heat from the engine without overheating the oil.
Try draining the sump and filling it again with the reccomended amount and see where it goes to on the dipstick.