1k on a 20 year old car that was probably 40k plus new?
I'd say you should be buyer beware at something like that. Accept it and move on.
If as stated above the dealer said "the knocking noise is normal on a cold start for this type of engine and age. He drove the car and said it drove ok." Then the car has been mis-sold.
Reject the car.
Regardless of age or value, it is not as described.