The gasket could have failed because for several reasons, if its never been changed before, its 20 years old, think how many times it has got hot and cold and had to hold pressure, and diesels have a higher compression ratio over petrols. Do you know if the coolant was changed at regular intervals?
 
On the subject of early Discoveries, I predict that the 3 door versions will go the same way as 3 door Range Rovers, I am not a Disco fan, I do prefer the iconic shape of the Defender, but I am on the look out for a fairly clean and unmolested 3 door 200tdi as I think they deserve to be saved.
 
If you decide to scrap it. I might be interested As HG change is simple enough. & I need a cheap run araound til I rechassis the 110.
 

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