How rusty is the good running wagon?
Is it just looking not so perfect, or does it have holes in the rockers/wheel
wells/floors?
Wouldn't you rather have the drivetrain you've come to know and trust?
I think giving the rust free car a heart transplant from your known
car is better than selling your old car to somebody who will spend
another couple of years running it into the ground and crushing it. 

Your choices are a 81-84 S123 engine and whatever other parts you want
to move with it, or an 85 engine and torque converter and differential
and speedometer and whatever other parts you want to use. (81 wagons
are turbos, 82 sedans and coupes got the turbo). Now that the speed limit
isn't 55mph, the ideal swap might be the 83 engine and tranny from your good
runner, with the diff and speedo from a 1985 300D, CD, or TD. 
Mitch.

andrew strasfogel wrote:
> 
> As feared, my "new" rust free 1983 wagon does indeed have a bad engine.
> :((    I was thinking of taking the drive train from my decent running 1983
> rusty 300TD, but this seems somewhat criminal; I would rather sell it as a
> daily driver to someone willing to give it a new lease on life.  Finding
> another used engine for this car is tricky because it must come from a
> 1982-84 turbo wagon (not from an '85), so I need to explore other options.
> 
> Is there any source other than Adsit where I get a reputable rebuilt
> engine?  What are the advantage or disadvantages of buying a cheaper "short
> block"?  All suggestions greatly appreciated!  Rusty only sells rebuilt
> transmissions.
> 
> Andrew
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