I am sure that I already know the answer to this question but what course of action if any can be taken if someone from OSO sells you an engine that is suppose to be a good running engine and you find out that it has a cracked cylinder? The only other part to this is that I had both engines shipped 500 miles to me.

With the way that this thing was gushing water without ever getting past idol and it had a bent intake pushrod on the same cylinder I am 99.9% sure that he knew that he was screwing me over on this deal.

What are my options on a bad engine deal?

Will ultimatly depend on what kind of paper trail you can show to proove your case should it end up in court. emails, phone calls, prinetd out add's etc...
If you have contacted them and they are unwilling to resolve this then you can put a little pressure on them here on the board. Maybe people who know them can lean on them to do the right thing...

You are 500 miles away - chasing him is equivalent to pissing in the wind. Contact him, tell him the issue and try to get a compromise - money to repair the motor. If he will not budge try to contact some members in his area that may know him and see if they can help. After that - bad mouth the $#!+ out of him till the cows come home.

Have you contacted the seller? 1st things 1st

take the engine apart, sleeve the cylinder in question, replace the parts that need replaced, learn a valuable lesson and move on... you'll waste more money chasing this ******* and get nothing, than just fix it and move on... thats likely why it was sold that way...

How much money you talkin about ?

depends on what they are, but sleeve installed is $4-500, plus one piston and ring set (for that cyl)
gaskets, and the pushrod he said bent, maybe a grand???
if no other damage

Would be interested to see how much the original purchase price was.

May not be worth fighting and do just as you say.
Fix it

usually the case

can you atleast say what state theyre in.and are they still active here.