First of all, if I'm not mistaken, the V6 in the '89 is the 3.0L which sucks...a lot...you don't want to go down that road, lots of problems with head gaskets among other things.
But, if you do end up wanting to go that way, here's some stuff to look at and ask questions about.
1.) The rebuild (THE MOST IMPORTANT).
A. There's a lot that could go wrong, any bonehead can take the head off, mess around with the internals, and call it rebuilt. Ask him if a pro did it, and if so look up the pro's reputation. If he did it, well you're trusting his intelligence and diligence with the most valuable and delicate part of your vehicle.
B.) You can check a lot of the rebuild by just looking at the engine itself, check for loose bolts (a lot of people don't have a proper torque wrench and after some running those things just get loose again), is the head clean? Any guy worth his salt will clean the head cause it looks good and takes virtually no effort. Check for oil leaks, if he did a bad job with the gasket (or if he put one on at all) you'll be able to tell pretty quickly with oil leaking.
C.) Get a compression test!
2.) Check your drivetrain.
A.) Run the rig through the gears, and all the gears in the transfer case. Make sure it shifts right and don't be afraid to get on it, after all, you're going to get on it from time-to-time and you're going to want the transmission to shift right.
B.) Again, check the 4WD. Lock in the hubs, take it in the gravel, turn it tight, listen for strange sounds or problems shifting it into gear.
C.) Check your U Joints and driveshaft, it's pretty easy to see if something is out of whack. If it's been wheeled and not taken care of, you're probably going to have to change out the U joints.
D.) Axels and differentials, what are the condition? Any modifications? Are they stock?
E.) Check your IFS, how are the shocks?
3.) Electrical - All lights work correctly? Blinkers? Horn? Windows etc. etc.
4.) Paint
5.) Interior
6.) Frame - I would move this up in importance but while you're down looking at the drivetrain, look at the frame.
A.) Are there any modifications?
B.) Is there dirt in any places you wouldn't normally find it?
C.) Any damage...hey, some sellers aren't honest.
And from there its kind of up to your discretion. That's kind of what I use when evaluating a vehicle.
