I replaced trans and fixed a few engine gaskets along with a new opti and when i put it pack together i forgot that the thermostat was still in the engine.

I had drained the block of coolant during the tear down so there was no coolant in the engine when I began filling it back up and cranked the engine I noticed a boiling sound so I turned it off and removed the thermostat then cranked it again to bleed the air out.

I looked underneath the car and noticed the y-pipe just past each collector is now white with the coating peeling off.

The engine sounded good for the two minutes it ran but now it is sluggish at idle and wants to die. Also it pops real bad like a backfire every 30 seconds or so.

So, do I need new head gaskets or a new engine or neither?

 

You need the thermostat and you can get the air out with it in there so do that correctly even if it takes you a couple tries - that is normal to have to bleed it a couple times. And consider the possibility that you messed something up with the opti install and your timing is off. Also make sure you don't have any big vacuum leaks any where.