You have bigger fish to fry. The corrosion on the water pump and visible in the other pics indicates that you have acidified coolant. That is caused by acid formed from combustion products in the cooling system. Nothing else will do that. Fix it now before you have more problems down the road.
If you still have the old coolant check is "coolant voltage" with a DVM and a piece of brass. Set the DVM on the lowest DC volt scale and hook one lead to something brass. Put both leads (including the one with the piece of brass) into the coolant. You get a "brass/acid" acid battery that way. The voltage read indicates how much acid is in the coolant.
.050 volts DC an you are golden.
.300 volts and you have trouble.
.450-.700 volts and you are toast.
Thanks Toby... I have had the coolant out for a long time already so not possible to check it. Yes you are right... the PO did not have ANY anti-freeze in the coolant at all! So it was corroding the engine (what an idiot!).
Anyhow I have not updated this thread for ages... since my last post I have done a huge amount of work - mostly with the help of Andrew Libby and some other great guys over on the Samba.
Here are the highlights:
cam out, checking valve lash
pulling IP sprocket
removing glow plugs
IM shaft sprocket off
oily rear seal
crank sprocket off
troubles removing oil pan
hacked tranny mount
turbo welded to exhaust
bent oil return line out
IM shaft out
crank plate off
a look at my turbo inside
oil inside turbo to intake hose
dip stick stuck into turbo from above shows that oil is not pooling inside turbo.
checking oil pump
oil pan off
making IM shaft front bearing pulling tool
new oil rtn pipe comes... too small ID
...so I drilled it more wide
pulling IM shaft bearing
new bearing installed
im shaft plate ready to install
crank plate ready to install
new FEBI (in spec), ready to install
crank plate installed
im shaft, seal, and plate installed
oil pump installed
oil pan installed
oil return line installed
crank bolt installed (ouch!)
crank and im sprocket
installing new shims
cap #1 ready
second hand turbo found, considering rebuilding and installing