Well, I paid about double your budget unfortunately. Mine was $2200 shipped, but it was in excellent shape (ok, I've yet to start it, but it sure looks clean!). Four-wheel-drive transmission included. The same outfit can get the C223T w/ 4x4 gearbox for about $1500. Shop around, though, and post if you can get a better deal -- this was the best I found, straight from Japan.

I have heard the frame on the 86 is different, so you may need to perform some modifications to get the 2.8TD installed if you go that route.

And as for the conversion, I haven't had much free time to get to the truck these past 2 weeks - started a new job and had some vacation plans over the holiday. I do plan on getting the wiring and fuel system squared away this weekend, though... we shall see. I did get my Helm, Inc. Electrical Troubleshooting Manual, which looks to be one hell of a resource and should come in very handy.