Usual things big puff,
I know you've said you're aware of the chassis testing but please make sure that you take a hammer with a good flat end (not a ball point) and give the chassis a good whack. Don't go stupid or put dints in it but if it makes a horrible thud or the hammer goes straight through it then there's obviously going to be some welding required. Check the entire chassis. If the back is a bit rough (i.e. from rear springs mounts right to back) that can be swapped with a new rear cross member - they do rot through eventually but obviously the more solid the better. If the main rails are rotten I wouldn't entertain it, and the front of the chassis definitely needs to be solid, they don't tend to go further towards the front.
With regards to the engine, inspect it visually before you start it. Remove the oil filler cap and make sure that you can see oil has been entering the rocker area (shows oil pump is working). Remove the water reservoir cap and observe the level. Is there anti-freeze in there too or just water? If he's been running it with pure water it wont have done the cooling jacket any good and it may be gunked up or created small pitted areas around the water jacket on the head. Obviously check the oil level before you start the engine to make sure that it isn't dry. If the oil looks golden, it would suggest that he's just replaced it, which either means it's well serviced or it's been done possibly to hide a problem such as water / diesel getting into the oil.
The engine should start immediately following five seconds on the glow plugs. It might take a few turns if it's been stood for a while. Once the engine has started, fluctuate the revs for a few minutes from high to low until it starts to warm up. Next, remove the water reservoir cap again and ensure that the level hasn't dropped and that there are no bubbles appearing or a ridiculous amount of pressure. There might be a bit of a hiss as the cooling system gets up to pressure, but it shouldn't shoot water out at you.
Next remove the oil filler cap and place your hand over the opening. Can you feel any 'chuffing' (blow by) or can you see any oily mist? If there's nothing, it's good. If there's some chuffing or an oily mist, it's either the head gasket that's blown or the head has a crack in it. Also remove the oil dipstick and press your thumb firmly over the end of the tube for rive seconds and ask him to rev the engine hard. Quickly remove your thumb and see if it hisses or throws oil at you. If it's a health engine it wont do anything. If there's some where or a failed head gasket for example, it will hiss, or blow oil at you.
Next turn the engine off, leave it for a few minutes and then start it again without any glow plugs. It should fire straight up. With regards to exhaust smoke, there should be a 'black slug' on start up and maybe a slight whisp of black when you rev it hard. It should not produce any smoke on tickover. White smoke might be condensation in the exhaust pipe, partially burned diesel or even water getting into the cylinders. Blue smoke means its burning oil, which isn't good but can be a simple fix if its only the valve seals.
Other than that, give it a test run. You'll know when the turbo kicks in because it'll shoot off. If it feels gutless or there's black / white smoke, it would suggest that the turbo isn't working properly, or one of the pipes has collapsed etc.
-Pos
