Its the old story, you get what you pay.
When you read the ad it looks well speced and 12 months mot, 6 months tax, got to be worth a bit. I reckon its worth the extra £500/£600 over some of the others on Autotrader.
Depends on how it drives, each car is different and as soon as you move off you can tell if its up together and feels right.
Think your offer was fair but the owner wants to recoup some of the expense for his upgrades, which if fair enough. To me it all comes down to age of the car, that you can't change and they don't sell as classics yet!!!
I bought a turbo 440 Volvo, 50k and everything worked, went like stink all for £200 as it was 10 years old.