Is it dry under the stator cover? Will oil spill out if i remove it?

Yes. And just checking my own knowledge, if you are talking about the left side of the engine, next to where the chain cover is, then yes. It does have oil in it.

I've never pulled either cover, but from on this board's threads I think the big magnet bit is left side and the timing sensor etc is right side..
The big magnet thing is the stator?.. yeah?... in pics/threads on here when they break it certainly looks like there's oily residue sticking little broken bits of magnet to the inside casing. ..

Put a drip tray or bowl under there when you open it!

The "big magnet thing" is the rotor mounted to the end of crankshaft, the stator is the coils mounted to the inside of the cover.  And there is a lot of oil passing thru there for the starter clutch.  I drained the oil before pulling  the left cover and also before pulling the right cover.

http://gstwins.com/gsboard/index.php?topic=66025.msg824382#msg824382

The ignition pickups and the bikes wet clutch are inside the right side cover.

Thanks Jack! .. those 'bits down there' have never settled into my mental catalog! 

.. luckily mine has never broke yet... and if it ain't broke I don't need to mess with it eh?!

thanks for the replies! If this is the case here's my dilemma. I want to check if the starter motor is properly connected with the flywheel. If i remove the oil, how can i check this. I dont want to risk starting the bike without oil. Randomly, lately either the starter catches and the bike starts or the starter motor just whirs. very strange

Just pull the wires off the spark plugs and it won't start. 

Whiring noise is probably a loose rotor. Look for "goats" on the board. Don't know why but we always seem to get a load of these after the winter. (Including mine last spring.). Mine would also work occasionally and then not work other times. Make sure you have a good battery to test though before ripping into the engine.

This may be helpfull.