The brown light could be because its got after market bulbs in that are brighter than standard, this can burn the shroud as you say. I also agree with Carsick about the price. Look a little more and further a field, I'm sure you will find a better deal than that. The rusting or oxidising even for a bike with such few miles is not uncommon on the SV. It's all part of the budget bike syndrome. As for the headlight pushed in. Well that could indeed be a sign that it has been dropped. A tell tail sign is to look at the lock stops and see if you see any marks on them, this will be a sure way to see if the steering has taken a whack at all.
Personally If I had any niggling doubts I wouldn't buy, especially at that price. On the flip side, these are all things that you could use to barter the price down.
One last thing. I NEVER trust a dealer, regardless of any reputation they may have. Maybe I'm just a sceptic.
