I payed Aus$3000 (About $US 2500) . I figured that the engine alone is probably worth this amount. Only 147000 klm on it and a good service history. My yearly service on the 166 costs at least this much.
That seems like a lot of money to me, but then the Australian car market has always been different to ours.
Last week I bought my '91 164. Tidy condition, well looked-after (two owners since new), some paint chips/cracks on front bumper and a large number of bonnet stone chips. Otherwise good - leather interior not split or torn. Manual transmission, driving pretty well, no obvious faults. WOF (Warrant of Fitness) until September, registration (road license) until January.
The price? NZ$1000, which is AUS$890.
Two of my friends had the gall to tell me they thought that was too much for such an old car, and that it should have been $500...
Anyway I love my 164, and I'm now thinking of selling my 2003 FIAT Stilo Abarth - hopefully it's still worth $18,000!
As for the grinding noise - I would suspect a front wheel bearing. Has the car passed a roadworthiness test lately (I presume it's not called a WOF there) - ours are every six months so not usually long to go before the wheel bearings are checked again...
Maybe with the wheel off you'll be able to see where there's been metal-metal contact - e.g. the brake disc shield may be simply out of place and rubbing on the disc.