Welcome to the forums.
Where are you? Could the bike have been a flood victim and the engine full of water? That will lock up an engine as will a cylinder full of any liquid on the compression stroke.
IME sellers can often make up stories on the fly.
Just humor me on this, pull a spark plug from each cylinder, put the bike in second or third gear try to roll back and forth and see if anything pumps out of the spark plug holes.
I've never personally heard of a crank or rod go on these bikes, but anything is possible and for major parts failure, an engine swap is likely both your cheapest and least hassle route.
Well the following would be my guidelines, others may add more detail or point out something important I missed.
From 1998 to 2003 750 ACE are interchangeable, VT750C, CD, CD2 vary in the amount of shiny for cases and cylinder head trim, but all will interchange.
So look at what you have versus what is in the pictures for finish.
The versions for California have different emissions stuff, fuel evaporation canister and carb plumbing, but beyond that the engines are the same.
Generally the lower the mileage the better and the newer the better. These bikes do tend to run for ever if properly maintained, but lower mileage tends to indicate less owners and less chance of problems.
Look carefully at pictures to make sure nothing is cosmetically damaged visibly cracked or leaking and the motor mounts look good, the donor bikes have usually been in a write-off accident after all.
Find out what comes with the engine, if the engine is missing more than the carbs and starter I would pass on it. Some sellers sell all kinds of parts off the engine like stator, covers etc. that you will have to swap or replace, you don't need that hassle.
A full history of the donor bike is sometimes available as well as videos of the bike running prior to disassembly.
Take a good look at pictures of the donor bike if available, it is best if it is stock looking, no aftermarket pipes or intake.
The more background info the better, ask to see the donor bikes paperwork, you don't need a stolen engine for your bike.
If you can find an engine locally it may work out cheaper depending on shipping costs and you get to see.
If you get stuck finding an engine you like, engines from the 2001 - 2007 VT750DC Spirit, twin carb, chain drive models will also bolt up, but the cylinder trim pieces are different.