Buy a felpro upper gasket kit from autozone, it will include 6 new plug well seals and two new cam cover seals. Cost is around $80.
Your puff of smoke is probably the result of bad valve stem seals & not the oil in your plug wells. Oil in the head will slowly leak down past the valves into the the cylinders & accumulates while the car is at rest, then when you start it up, ****! That is not an easy fix, as you obviously have to tear into the heads pretty deep. Fortunately it's not a real serious problem...as the seals get worse your car will burn more and more oil until is smokes all the time, sort of like all those Chrysler minivans you see

But that could be a WAYS into the future, and if you just have a **** of smoke on startup I'd not even worry about it, my 95 MTX did the same thing at 68k.
Oil in the plug wells is common on the SHO. It won't necesarily make your car run bad, but the oil in there can shorten the life of your plugs and wires, so it's a good idea to get it taken care of. When you replace the seals it's a good idea to replace your plugs and wires too, since it's very easy to do with the intake off (people claim to have changed plugs and wires with the intake on the car, but I've yet to see how

). Use ONLY Motorcraft OEM plugs and wires...they have the proper fit.
As for running sluggish, your codes tell the story. When you remove the intake to replace the plug well seals try giving the EGR a thorough cleaning...it's the circle shaped thing mounted on the driver side rear of the intake. A plugged EGR valve can definitely make a car run poorly...if you clean it and it still runs bad you may need to replace the sensor. Your O2 sensor code may be the related to your EGR operation...I'd just clean the EGR, reset the EEC and see how it works. If you still have an 02 code then go ahead and replace them.
BTW, if you haven't already found it, go to
http://www.shotimes.com. It's THE source for Taurus SHO maintainence & modifications, with all kinds of step by step procedures for even the dimmest of psuedo-mechanics (like me).
And welcome to SHOforum!