Matt, Boyfriend's dad has been a mechanic for years, so I'm trusting his diagnosis. He just doesn't have the time/energy/money for fixing it so he offered it to us. He also has a car out in Minnesota that he wants to bring back, but has to get rid of this one first to make room in the driveway.
I did look up roughly how much a header gasket would cost on an auto supply site today and saw it was fairly cheap, so I'm not sure if there's something else that made him want to charge $100. But still, $100 for a car is pretty rad. Maybe it is head gasket, from what you described. I still have more questions before I commit to it anyway.
hehe, coolant is new to me. I had a VW Beetle (1974) for a few years in college. They are air-cooled!