I've got a situation without the expertise or money to handle it.

I have a 1995 Mazda 626 that I haven't driven in over a year.  It was
given to me, so the investment was zero.  Before I started having
problems, it ran fairly well but was cutting out... I'd had a tune up
and the fuel filter (I think?) done to try and fix it and it was a bit
better, but still cut out.  Aside from that it ran fine, everything
worked, decent gas mileage, A/C, etc.   A good car for our family's
needs. 130k miles.   One owner before us, it was used as a company car
and was well maintained.

It became necessary for me to replace the battery and the starter.
About a month later, it "freaked out", for lack of a better term, while
being driven, and made an awful screeching noise and was immediately
pulled to the side of the road.  Being broke, a "friend of the family"
diagnosed it as a flywheel problem.   It went off to this guys house to
be fixed cheaply in his spare time.

As you can guess, it never happened, because in the meantime we bought
something else to run around in.

Fast forward to a couple of months ago.  We get several quotes for the
flywheel job and all are $450 on up.  Not having that much money, we
wait.  We find a guy who works at a shop but works from home on the
side and he says he'll do it for $300.00... so we agree to go ahead and
he has it towed to his house.

Important fact:  he asks us if we're planning on keeping it or selling
it when it's fixed, becuase he has a Mazda just like it that he wants
to fix up for his wife.   Hmmm.  We tell him we want to drive it/keep
it.

About 4 hours after he gets it to his house, he calls to tell us it's
not the flywheel but the crankshaft... in his words: "Crankshaft's
broke. $1200.00.  not worth fixing."

If he is telling the truth, then no, it wouldn't be worth fixing,
becuase it's not even worth that much and we could just go buy another
one.

Still, we aren't sure and tell him just to have it towed to our house.
We pay him for the towing charges and for checking it out.  We also pay
him to do a quick fix on my mom's car that we were driving at the time
(borrowed).... so we end up giving him about $150 for everything.

My mom's car got broken into while at our house and the would-be thief
messed up the steering column and ignition... luckily there was a
"trick" to starting it so they didn't suceed in stealing the car, but
they did mess it up and for a while we were starting it with a
screwdriver.   We paid this guy to fix it so we could start it easily
but it wasn't properly fixed and the starter was "going out" (he said)
so it was still iffy and sometimes wouldn't start at all.

He offers to fix it for $50 if I'll give him the Mazda as payment for
the rest of the work.
Remember how I said his wife had one he wanted to fix up?

At this point, we don't know this guy and aren't sure if he's honest...
so we decline his offer.  Besides, my mom wants to have the car towed
to HER mechanic and have it done that way.  So we  have the Mazda, and
he left parts off of it (and put them in the backseat!)... and we don't
know if it's actually the crankshaft or just the flywheel, and it's
been sitting outside of our house for a couple months.

To get it properly looked at we'd have to pay for more
towing/diagnostic fees, and if it IS the crankshaft, we aren't sure we
want to mess with it.

Meanwhile, some guy has been coming around offering us $200 for it,
as-is, to use as parts for HIS Mazda of the same year/color.  He needs
a door and other things.  We really need to give him an answer.

Our dilemma at this time is whether or not we shoudl just take the $200
offered and cut our losses, or spend more time/money having it checked
out in case it is only the flywheel, because we could then have it
fixed and running for under $600 (in theory?!?), but that doesn't
include the $100 we spent having it towed around in the first place....
we really need a second car but basically we aren't sure if the Mazda
is worth dumping money into.  We could have it towed and spend money
having it looked at only to find out it IS the crankshaft after all, at
which point we'll be back to square one and our $200 buyer might have
moved on.

I've had to get rid of enough "dead" cars in the past to know that $200
for a "dead" car with a big problem is a good offer.  I don't want to
let him (potential buyer) get away and have to have the thing hauled
off for scrap metal for free instead... but I also don't want to sell a
"good" car for $200 if it could be fixed and ready to go for less than
it would cost us to go out and buy a similar make/model/year vehicle.
If we sell it we're going to be car shopping soon anyway, for something
in the same range, because our other car gets horrible gas mileage (v8
mid-80's station wagon).

I hope this isnt' too disjointed, and I hope someone can advise.  We
just don't know what to do and really don't know anyone here who can
check it out for free for us here at the house.  Is there a way that we
can "look" and see if the crankshaft story is true or not?

Thanks much!