just because not building pressure can still have blown gasket you need to check hydro carbons in coolantThanks for the offer, I may contact you after he decides what he wants do with it. The other day while we were talking guns, he said " I don't have a .22, everybody should have a .22, right". I may work my into a trade for this thing.
The oil is clean, no water in it, can't tell about the coolant as it is brown and rusty looking. The running pressure test did not indicate a blown head gasket. I am thinking the same as your suggestions along with a comp. test and maybe leak down test before spending too much time or money on this motor.