i`m not a bodywork person but enjoy mucking about with engines. Thrusts could be inspected without having the engine out and the oil light could just be rubbish or tired oil, dodgy sender, PRV, (you said gauge in your post, does it have one?).
I think if it`s as you want with paint and body it`s worth a punt. Not at 12K though.
BTW I spent north of 6K on a tuned 1500 engine with roller rockers, head/cam work etc a couple of years ago, but that was with the builder doing everything including putting it in the car, rolling road tune up and putting 600 miles on it.
Steve