Warranty or not, that engine is worth well more than an $800 offer despite the ten years, if the mileage is genuine. Rarely does one with that little wear and tear come through, and once the time-caused problems are fixed, that's destined to be one of the better examples out there. If I saw a car on eBay or in the classified ads that had 90K on it, a newish motor, and could hear it run in their yard after I tinkered with it -- I'd just plan on spending $2500-3500 on it or else let it sit until somebody offered them that for it. W126 with the same engine in it, I'd be more in the $3500-5000 range but would REALLY need to see that it could be made to run before I agreed to purchase.
The "tell them it's not in good condition, buy it for $500, and then fix it for 50 cents and drive it forever" approach just never feels right to me. I freely admit that my 240D, given to me by my uncle, was not running when he brought it to us having given up on fixing it, and we started it with WD-40 and backed it down off his trailer. But that's... family. I'd feel worse doing a deal like that with a stranger, especially when the car has a family history with them, etc etc etc. Besides, I offered it back to my uncle once we had it running and he felt like doing me the favor and really didn't care about a Benz anyway.
Just saying. I think this is one I'd offer to get running for them (if it could be cleaned out and cranked without major parts being thrown at it) so they could sell it for a fair price in the yard, rather than trying to low-ball something that potentially nice.
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~Michael S.~
Past cars:
1986 300SDL
1987 300SDL
1982 240D
1982 300SD
Current:
1987 300SDL
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