Well, after some further communication with the seller, I found that the only real problem that needed to be was broken blinkers. A friend and I drove up to Santa Cruz yesterday and took a look at the car at 1:00PM. The paint was in worse condition than I had hoped and it looked as if there could be some minor oil leaks from the engine (Nothing dripping, but plenty of thick black gunk). During the test drive, the engine felt a little rough at low RPM, but smoothed out at around 3500 or higher. The transmission felt fine, and the only other thing I noticed was some faint "ticking" from the engine which I presumed to be noisy valves (am I right on this?).
This being said, I still felt the car was worth $1700 but I figured I might try to barter a bit so I offered the woman and her dad, who did most of the talking, $1550 assuming it would pass smog. They said they would think about it and get back to me in an hour and half or so. After about two hours hanging around the beach and boardwalk, I got a call from the woman saying that someone had driven it before us and offered $1700. I said that if she was firm on the price, I would accomodate, but apparently since we had left she promised it to the "first" drivers.
Even worse, she said that they weren't sure they wanted the car but refused to sell it to me. The seller also said that she couldn't tell me that day, but might be able to tell me the next (today) if they had made up their minds. My friend and I ended up visiting some of his family in San Jose, but she never ended up returning my calls. Our assumption is that the "first" drivers had really checked it out after us, but the whole thing still doesn't make much sense. Anyway, it looks like I'm going to have to pass on this one so my search continues. I'm still considering that one in SLO, but I'm not too sure about the price.