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from what you described ryland, i think the car is well worth saving. like others have pointed out, superficial cosmetic rust is completely different from structural serious rust. i personally don't care how much cosmetic rust a car has if it runs well. i actually like my cars to be a little beat up so that i don't care when other people run into it with shopping carts or whatever. when i had a nice car, i cared about that kind of stuff and it was stressful. i also take a certain amount of pride in my rusty things running better and getting better mileage than most pretty new things i see people buying for ridiculous sums of money.
on top of that, the cost of the repairs you mentioned the car will need are outweighed by the savings in fuel expenses. those repairs are mostly easy DIY stuff (exhaust systems are about the only thing i can't do at home) and pretty cheap, especially when compared with buying a new used car, VX or otherwise, with an unknown history and various hidden problems that will appear over time. i prefer the devil i know rather than the devil i don't.
and on top of THAT, i just like preserving cars and keeping them on the road until they are actually unsafe to drive anymore. i think of all the resources that go into each car and what a waste it is to scrap them when so few minor repairs are all that are needed to keep a car in good serviceable condition. i fix old 4wd tercel wagons for friends all the time, they're my fave.
for a few problems you mentioned, i would do the following:
burning oil: do compression test. if compression is good, add 1/3 can seafoam to oil and run for one or two tanks. this has worked wonders for me for cleaning carbon'd up rings.
water in the footwell: remove all of the carpet, spray water on the car and see where the water is leaking in, and drill a hole there for it to drain out. spray the entire floor with undercoating or bedliner in a can. i've done this on a few work vehicles since the cost of repairing the leak was not worth it and it worked great. easy to clean out, too.
if you decide to buy it for parts, i agree that $200 is fair. beaters are cheap, parts cars are cheaper. good luck with whatever you choose to do with it.
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