Since I hate it when I find posts in a search that never give the final findings on something I thought I would go ahead and finish this one up..
In short, we really found nothing on this engine..
Pulled the rod and main bearings, pulled the head apart, pulled the pistons.. Everything was fine.. It actually looked pretty damned good at 287K miles.. Since it was in pieces he decided we may as well freshen it up to go another 500K miles.. New rings, bearings, timing belt and all the trimmings, new valve stem seals, and a new turbo..
After we tore this thing all apart and had a good BS session around the wood stove (beer in hand of course) this is the best answer we can come up with: He bought the car at 160K miles.. Always used Pennzoil as that was what the PO used.. The last time he changed oil before the glitter showed up (around 286K miles) he noticed some sediment in the bottom of the jug of oil after he poured it in.. Didn't really think much of it at the time, other than it was odd.. 5K miles later he changed oil and found the glitter.. Checked the oil and still found glitter, although much less..
Something obviously must have been wrong with that oil that caused some wear, although not a significant amount of wear (or there was metal in the damned oil).. When he still found metal after the oil change it was residual flakes that were lurking about in the engine still..
For now we installed a 2 piece pan with a magnet in the bottom.. He's gonna break it in, run it a few more oil changes while monitoring things.. After that I think we may drop the pan again to clean it and the magnet, then see what happens from there..