Confused

Kayla
So I'm a little confused. Went to the doc yesterday and they did a cervical exam (1 cm dilated and 80% effaced) and they said they could feel baby's head there and that he has lots of curly hair. My thoughts are how can they tell this if he is in the amniotic sac still?  Does that mean my water has broken?  I have thought for the past week or so that I might have been leaking some fluid (I feel of the curb and had some leakage the next day but couldn't tell if it was discharge or what) but I'm not sure. Any thoughts?