There are a few things that you can check to see whether or not the engine is just about to pack in!
Starting
Does the engine fire up at the turn of the key or after two or three turns of the starter? It should do (even without any prior glow from the plugs). Once it's fired up, turn it straight off and try again. It should fire back up immediately.
Blow-by
Perhaps the most obvious sign of a worn / troublesome engine. Fire it up and allow it to reach operating temperature. Remove the oil dipstick and press your thumb firmly over the dispstick tube for 5 seconds. Then, following the five second pause, quickly release your thumb. Does it hiss or launch oil at you? Slight hiss is fine but lots of pressure would indicate worn rings or a blown head gasket.
Temperature
Monitor the engine temperature for five minutes or so. Does it sit at operating temperature or does it continue to increase? Don't touch an engine that's running hot or boiling over because it's likely to have a split / cracked head or cracked pistons.
Pulling Power
Take it for a spin. Even in the disco it should give you an indication as to how powerful it is. If it seems lacking at all, try and find out why and make sure that you run it and push it hard through all gears. In your 'fender it'll pull away and accelerate better because of the gear ratio in your transfer box regardless of the weight of the 90.
Oil Leaks
Everyone knows that a land rover engine drips oil, but it's in your interest to indentify where before you fit it to your 90. That way, you can replace gaskets & seals whilst it's out of the vehicle which will make life easier for you and your knuckles.
Coolant Leaks / Pressure
Before you start the engine, remove the header / expansion tank cap and check the water / coolant level. Then, start up the engine and rev it up to temperature whilst keeping an eye on the coolant sitting in the expansion tank. Does it bubble or fizz? If it does, suspect the head gasket. If it looses water, suspect the head gasket or a cracked block.
Chances are it'll be alright. If your old clutch looks worn swap it whilst you've got the engine out too. If it looks ok, leave it be and worry about that when it goes!
-Pos