Consider the bike as if the engine were completely missing. If it's still worth the price to you, pick it up. If you can salvage the engine, bonus! If not, you still got something worth your money.
Seized engines can be something as benign as rusty cylinders or as malignant as a lower end roasted from lack of oil. It's hard to say what could be the culprit, but a total teardown is most likely.