A compression test would give you some indication of the health of the engine. You can rent the tool at autozone for "free". The sandy dirt in the intake (past the throttle body?) would concern me. A little bit of grit getting in those areas when the engine runs is probably normal, though.
Was there any oil in there? Drain and feel around for sludge in the pan. Oil is a good sign, dry may not be bad, gritty sludge is a bad sign. In the future, when you get ready to run the engine, you don't want to start it right away. Crank the starter with the ignition off to get oil pressure established before starting the engine.
The TBI engine would be easier to get up an running, and I'm sure you could part out this engine and make your $850 back...definitely more power here and probably a bit better MPG, too.
I'm not sure if this is a good idea, but i'll throw it out there: you might blow into the spark plug holes with compressed air to remove anything that may have gotten in.