Let me add my .02.
Buyer
First, If you are buying a motor that nice, that cost that much money, take the time to put it on a stand. Pull it apart, and inspect it.
Seller
Second, MOTORS TEAR UP. Before you sold it, you should have inspected it so you knew what you were selling.
End of story, you both should have inspected it!!!
PS was the car you got in trade everything he said it was?