Just bought another Disco myself, same as yours a 99 Series 1 for $2k with a bit of change, low kms at 190k from new, stock standard which is how I like them as it gives me a blank canvas. Hope to get it regoed in ther next month or so, bloody work gets in the way as per usual!! Budget build this time so always on the hunt for cheap Disco stuff on e-bay, etc.. best way to build up a old 4WD.
Owned about 5 Discos over the journey, last one was a early-ish 93 3.5 V8 (think the 3.9 is a tad slow) with twin lockers, 4.375 diff gears and HD axles and 33's, the damn thing used to climb a wall if you point it at one!! Sadly had to sell it about 18 months ago as I had a few debts to sort out (long story) now a bit more financially sound I can build this one up (not as full on as the 93, it's more of an all-rounder but we'll wait and see!!).
V8- Ok in water, good spray with WD40 etc.. does the job. If you're still unsure, put a tarp on the front.
Re- Oil leaks. Unless it the Exon Valedez don't worry too much. A few drips here and there are okay, just clean it off before the RWC and most 'sensible' testers will pass it
Electrical stuff- Unpredicable at times but the later D1's had there shit sorted out by then, the early ones were random and quite amusing (my 93 would tun the wipers on for one wipe when I put the heater ana on low, go figure!)
Suspension- Plenty of kits out there to suit your budget, anything around the $1k mark is decent quality. 2 inch is plenty
Tyres- 235/85's or 265/75's will fit with a 2 inch lift. The rear guards near the mud flap will need to be trimmed as the tyre will catch the panel and bend it plus it' damage your tyres ovr time. if you do it as neat as possible you won't notice it!!
RWC- It can be a pain for a Land Rover owner as I have found that a lot of mechanics have a piss poor attitude towards Land Rovers, if it's not A Toyota, Nissan etc.. they are not interersted and will go hard on your vehicle. If you run into one of these ignorant turds, go elsewhere because having to pay extra for another one would be cheaper.
In reality being typically British vehicles they do require a bit more attention than most Japanese 4WD's but once you know the issues and sort through them they reletivley trouble free.
Have fun with it.