I would contact the seller and give him a chance to make it right. If that dont work I'd leave bad feedback.
Sounds like he lied about the condition of the engine.
To tell the truth if it was me this happin to I would drive to his house and stomp a mud hole in his @$$!
People know what they are selling 99.9% of the time. Thats why he said the motor was good and also why he said as is.
The as is crap is a good tool to use when your trying to rip someone off.
No matter what you say to the guy you bought it from he has that tool now. Well I told you as is will probably be the first thing out of his mouth. If thats the first thing he says, you know that he knew what he was sellin was junk. THATS WHEN THE STOMPPIN STARTS!
You dont know till you give him a chance. He might be a stand up guy and go outta his way to make the deal good.