Nice wagon... I love those years. Mine was an 88 SPFI (Single point fuel injection-throttle body) but will try and throw some info your way.
First, I would do a compression check on the engine. Disconnect battery, wedge open carberator and do a pressure check on each head. Head gaskets aren't that bad to do.. just a bit time consuming.
Your capped off lines to a heater core... yea.. sounds like a bad heater core and that would suck.
Leak behind plastic.. possibly water pump, (can't remember if there is a front freeze seal under belt covers) or leaking down from above. Look around the carberator there is a 3/8" line on each side of the carb. sometimes those will split and dump coolant on top of engine and it will work it's way down etc..
also, I had a leak I couldn't find so I took a radiator cap and soldered a 1/4" copper line to the top and put it on the radiator, then I fed 10 psi air to the coolant system that way engine wasn't hot. During the pressure check I could touch, snoop and listen for the leak till I found the leak. You could make a connection at the capped heater core feed line and do the same thing, find a reliable air source that you can assure to control and an accurate pressure gauge... believe the radiator caps relieve at 16 psi so wouldn't go above that.
Your funny electrical issue.. a bad battery does funny things to the roo's, also a failed resistor in the alternator... sounds like either one of them...
The dieing thing could be a combination of sitting for years, bad gas, timing etc.. so don't worry on that yet.
If your oil pump wasn't working then your engine would be making lots of ticking noises etc...
There are others on the site with alot more experience then myself but saw you post so hoping some of this helps but the big thing to remember is and I have made this comment in the past is your on the learning curve side.. takes longer, seems to cost more but once you get past that then it becomes easier and these rigs become funner!
So far it just sounds like it has been mistreated a bit... if there is a bad motor or what ever that is the way it goes sometimes. You put money in and hope for the best.... so far I wouldn't undo anything I have learned or spent on my roo's.
good luck..
Edited by Indrid cold, 22 November 2010 - 05:19 AM.