Is this sludge or combustion by products of the gasoline used in the early years of this tractors life.
A combination of all of the above. Those old tractors were used in some of the worst environments, and to top it off they had overly robust cooling systems, and it's not uncommon for people to completely remove the thermostat. That really never allows the engine to fully warm up unless it's out plowing for a few hours. Decades of vintage oils, a vintage filtering system, and an old flathead engine design all contribute to the problem. The kicker is that those old engines still perform just fine despite all that.
If you want an eye opener, pull the side covers off the valves and give that area a good cleaning.