Lower intake gaskets and the EGR stovepipe in the upper manifold are the leak points in these engines. If the radiator level has been low and the Dexcool exposed to air, it sludges.
If this was my car and I wanted it fixed correctly, then the radiator needs to be replaced, the upper manifold replaced and the lower gaskets replaced. That's well over $1,000 worth of work. If that's too much of an expense, then I'd do this: drain the radiator (the drain is on the driver side at the bottom), take the thermostat housing off (really easy to do), take the stat out, and reinstall the housing. Fill the radiator with a chemical flushing agent and water, turn the heat on full, and run the engine for a while. Maybe do that twice. Drain the system, fill it with water again, and run the engine for a few minutes. Do that twice so all of the chemical flush is out. Drain the radiator and fill it with distilled water. Run the engine for a minute, drain it again, and refill with distilled water. Run it again for a minute, and drain the rad. That way the system has distilled water in it. Then, take the thermostat housing off and put a new thermostat in. Then, with the radiator empty, add a can of bars head gasket fix. The stuff works; it's in my dad's Olds 88 as I type.
http://www.barsproducts.com/1111.htm
Then, add Peak Global lifetime 100% concentrated antifreeze to the system at half the system capacity (because the engine has all distilled water in it). Then, top off the rest of the system with distilled water.
I've saved numerous leaky GMs this way, and it's really quite easy to do on an Olds 88.
Oh, and put a new radiator cap on it as well. Also, take the overflow tank off and flush that out and add 50/50 distilled water and Peak global to it. You'll likely have to change the hose as it'll be brittle. Also, while you're at it, change the upper radiator hose, as it'll be the first to fail since it's the outlet from the engine and it sits directly above the exhaust crossover pipe (it gets really hot). I found the one in my dad's 1999 Olds 88 the size of a small water balloon one day and on the verge of failing).