Re: Fuel in oil - where to start?
If you could go on line and find the pressure spec for the original mechanical pump you could compare it with the electric pump, which may be delivering more than the float valve can handle. I put an electric pump on a Ford Engine into a Willys truck. IIRC, it put out about 4 to 5 lbs of pressure, worked great.
It could also be that the float valve tip, generally rubber or Viton? has worn away? Maybe a speed shop or small engine shop might have loose parts like that, if you can get them to talk to you?