not burning fuel?

[AznTahoe0408]

I have a 99 Toyota Corolla 1.8 v4 i believe. 99,000 miles on the odometer. The other day my sister was driving it and she said that the car started to sputter and acted as if it was about to die. She put it in park and it did not do it anymore. She put it in reverse and it did the same thing. Got it towed to the house. The engine was knocking but i know it was because the oil level is low-it has an oil leak somewhere. i think its at the valve cover. I drained the oil it was very thick after only 3000 miles. About 4 quarts goes into the engine and when i drained it only 2 quarts came out, very black. I refilled it and the knocking went away and no sputtering or anything happened whenever i test drove it.

I pulled the plug and wire off the cylinder all the way to the left and both were wet with fuel i believe. Its not coolant because i know the smell but i think its unburned fuel. all the other plugs and wires were fine. Shes way overdue for a tune up so do you believe thats the place to start with diagnosing the cars problem?