Sounds like he talked himself into a corner Phil!
I can't see how it would pass the emissions test in the MoT if the head gasket was shot either.
It's a real shame you didn't take photos of how bad the car was when you were there, it would help to prove your case in court for your deposit to be returned, your expenses for going to collect a totally misrepresented car and anything else you're out of pocket for.
Didn't you say your other half went with you to collect it? You have an eye witness in that case not only to the state of the car but to the fact matey promised you your deposit back as well.
Sue the eejit from ****hole to breakfast time!