GL I think I went about it the wrong way. I asked him about the p/s pump and accessories and he said 50 bucks; that's when I asked him about the entire unit. I should have worked it the exact opposite (engine price first, then p/s).

I think I might be able to work him to $175.

Valve cover is on and sealed tight. So there's probably been minimal water in the cylinders. the 1 bbl has the original carb cover assembly fully intact, with the opening tilting slightly downhill. So I doubt if much water has entered the head that way.

Would it be best to pop the oil pan off and see what's in it? Because wouldn't any water in the cyl. eventually make it's way to the pan?

Does a rusted cylinder (or cylinders) mean a trashed engine necessarily?