To answer your question; I would do the above, as well as check two other things:
A. Compression test. No doubt you will have lost a bit, but what you are really looking for is the differential between cylinders; you don't want more than 10-12 psi difference between them. Any more than that and it indicates valve and/or ring issues.
B. I would replace the cam chain and tensioner on that motor, as flailing cam chains were about the only problems ever found on high-milage examples of those bikes and you really don't know the level of care it has received.
I would also have the current owner start the bike cold, with you standing off to the side/rear, and watch the exhaust. A blue puff on cold startup indicates oil is leaking down into the cylinder(s) while the bike sits. This is indicative of worn valve guides. Those are about the only things to watch for outside of the norm.
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