Question about buying 1987 Chevy Suburban?

Last night I looked at a 1987 Chevy Suburban that my friend's dad owns. It has about 125,000 miles on it, assuming the odometer has only rolled over once.

Last night was the first night it was started in about 16 months. My friend had to use ether to get it started - he sprayed it right into the carburetor, and initially, we had a mini fire ball going! We had no problems getting it started after that.

Overall, the engine sounded very good, and the oil looked clean as well. I'm told the engine was rebuilt a few years back.

Initially, we could not get it to go into gear at all - we moved it into drive, reverse, and all the other gears and got nothing. We decided to put 2 quarts of tranny fluid in, and at first, it was grinding whenever we moved it into drive or reverse, but that stopped, and we were able to get it going.

The steering felt a little loose - I don't know if that is normal or it needed power steering fluid. We were going to put some power steering fluid in, but could not find the place where it goes in. Does anyone know where to look for this?

The body was a bit rusty, but that's ok with me. The tires looked like they were in good shape.

Based on what I've told you, are there any "red flags" with buying this thing, and is there anything else I should look for or inspect before buying it? He only wants $500 for it. Thanks for any feedback you can give.