Mark,
Sorry for your problems. 2 things pop into my head. One, an old creek bed often has sand and gravel layered with clay. There could be a broad sand layer running under the dam. Digging into the outside dam face could expose the problem.
Second, does the water seem to rise to a certain level and stop? If so, there may be a sand layer right at the water's edge. Look for crevices, holes, and gaps running along the water line and just below. If you locate any sand layers, it's possible you could dig them out and pack them with 2' of clay for a real cheap fix. Best of luck!
