Joe - The name of the dealer is "Autoexchange" in Lawrence, KS. I have to hand it to them...although they have been a little slow, I feel they have been relatively honest and easy to deal with.
I just about crapped my pants when I checked the oil after the first tank of gas and found there was none on the dipstick, but when I called the dealer, they said they would "get it taken care of" and do "what ever it takes to make me happy" (I'm sure they mean "within reason"!)
But in the end, they came through. Of course what would really make me happy was a new replacement engine for the VX at no cost, but even I didn't expect that would happen.
As far as getting a "bargain"...of course anyone can feel free to try, but that was one of the chips I put out on the table as well... asking if they would just refund a portion of the purchase price to make up for the engine. They went back to the claim that since the VX was for sale due to a repo, the bank and the dealer had a 50/50 share of the profits and the bank wasn't budging on their side.
In reality, I suspect what will happen is, since the vehicle looks and runs great with absolutely no indication of oil consumption until you drive it, the bank will take it to a wholesale auction where it will sell "as-is" for a decent price. This will effectively "wash their hands" of the whole issue. It will then go onto another dealer lot and they will get to deal with it.
One thought I had was trying to track it down in a couple months, see what the dealer price and warranty is, either go to them and explain how I know what the vehicle history is and see if they would want to cut their losses early, or specifically (in writing) warranty the engine against oil consumption.