Even if you have to stick another $750 into it, I think it would be a good deal. Things I would take a good look at. I am assuming that the dealer has not touched it. The first thing I would ask the dealer is "Why he does not want to stick money into it." If the reason seems off and the unit looks in good shape perk your senses to high alert. Price seems too good!!! If it has no major flaws (I'm thinking engine problems) check the following.
1. Look and smell the motor oil, hydraulic oil and air filter.
2. Check the pulleys on the deck for looseness and wear.
3. Check the blades, can be $$$$$
4. Check to see if the handles stay together when going straight forward and reverse.
5. If one wheel bearing is bad check the rest.
6. Check why muffler went bad.
7. If you have a compression tester, do a compression check.
8. After you figure out what you will have to replace, ask the dealer the cost of those parts. This will give you an idea of what it will cost you to repair.
Remember dealers normally don't give up a really good unit with out a reason.