Jack,
You are absolutely correct about the AJ6 and AJ16 engine in the XJ40. BUT, that engine usually didn't start to puff smoke until it was well into the 100,000 mile range and a number of years down the road.
I would think a 2006 that is puffing blue smoke has a soon to be serious engine problem that should be looked at as soon as possible. I would assume that it is still under warranty
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