There are lots of issue to look at when buying an Mk1 or MkII Diesel and it all depends on what you want.
Things to check would be:
Head gasket
Compression
Clutch
Rust
and many more little things.
As far as price, these kind of cars are retaing their value. Cars that are in amazing shape are going for $5,000 on eBay. You might be able to find one on Craigs List that is in decent shape for a better price and possible close by.