Two Half-Metro's = 1?
 

So, scrolling around on the local sites, I've stumbled across two intriguing items.

1995 Geo Metro 3 cylinder 5 speed - rollover with good motor and transmission. $700 / OBO. Red 2 door (about 30mi SW of me)

and

1993 Geo Metro 3cyl automatic Ran into water in Kmart parking lot during a massive storm. Pulled water into engine. Was said to be something wrong with one of the cyclinders, has been sitting for a lot of years. Just looking to get rid of. Could be a good runner if a new engine was put in. Green 2 door $400 OBO (about 100mi west of me)

If I could get both of them for under $1000 (including driving to pick up) would it be worth looking into?

The flood one would be good to convert to electric as well, the rolled over one might be worth $400, $700 seems way to high unless you could drive it home as it is.
Junk yards sell metro engines for around $100, the read advantage is going to come from swapping in a manual transmission of course.

It crossed my mind to offer $400-$500 for the 1.0L/5spd, rip it out, and scrap the rest of the car to recover some of the money.

Yes $700 seems way too high for a written off Metro, unless they are super rare in your area or something. Something else to consider is that if you take all the parts you'll need for the drivetrain swap into the other car, what's left won't be worth much unless there are some saveable/sellable panels like the hatch etc, or maybe some interior bits. The catalytic converters aren't worth much for cores off those cars, and its value in scrap metal is pretty much nil after the motor/trans/pedal assembly/ECU is gone out of it.

offer him 300, if he says no, give him your number and leave. WHEN he calls you back you'll have a "cheap" project.