How would one go about properly storing an engine for an indefinite amount of time.

I've got a 300D that has just become a parts donor for my my 300CD. When I get my carport closed in I intend on tearing the engine down and the transmission as well for refurbishing.

Right now the engine is still in the car. But just sitting outside can't be all that good for it. Plus 2 weekends go I removed the thermostat housing. Would it be better for me to remvoe the engine and spray something inside the water and oil cavities? Or replace the thermostat housing and refill it with antifreeze and leave it at that.

I don't know how long it will be before I get to messing with it.

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'84 300CD Turbo 132k (Anthracite Grey) - WVO - My daily driver - Recently named coo-coo-coupe by my daughter.
'84 300D Turbo 240k (Anthracite Grey) - Garage Queen
'83 300D Turbo 220k (Orient Red) - WVO - Wifes daily driver

I'm not a certified mechanic, but I did stay at a HolidayInn Express last night.

All you need to do (if the engine is still capable of running) is flush and drain the coolant, drain the old oil and replace with fresh for the wait period. When you rebuild you'll be cleaning and relubing with assembly grease anyway. Depending on the extent of the rebuild, if you're not going to touch the pistons/rings, then make sure you seal the spark plug holes, intake and exhaust ports to prevent stuff from getting into the combustion chamber.