It sounds like your mechanic friend has identified most of the trouble spots. The A/C evaporator can fail at ANY time, though -- ours died at 36,000 miles -- and be prepared for an expensive fix, because they have to pull the dashboard to get at it.

Broken motor mounts are par for the course as well but not so expensive to fix.

You're wise to avoid AWD cars because they're ultra-sensitive and are known for having their bevel gears go south. We have a '99 AWD, wouldn't do it again.

The electrics on '98s and '99s are congenital problem areas, especially things like power doors/windows, and the glue that holds interior door/ceiling materials on is known to fail -- Volvo used some eco-friendly glue that doesn't hold up.

You will also have to do the timing belt shortly.

The cars do demand rigorous, regular, time-consuming maintenance so if your prior experience is with Japanese or US cars you should brace yourself for a little culture change. They are definitely comfortable, a ball to drive when they're working right, and safe as the Bank of England, but I do not think they are generally "reliable" in a peace-of-mind, Consumer Reports kind of way.

We bought our '99 V70 new (got it from Sweden via the European Delivery plan -- very fun) and had fantasies that we'd send our son off to college with this "brick" when he's a freshman in 2012... well, after four and a half years with the (faithfully maintained) car, we understand the car is no brick at all and it's not going to live to be fifteen years old... not without insane ownership costs, anyway... two or three more years, max, and I expect we'd be looking at a Lexus or Infiniti next time.

I would be terrified to try to keep my V70 around over the 100,000 mile mark, which is a shame... Volvos of a generation ago were said to be "just getting broken in" at that point, but these are not those cars.

Good luck with yours, though, and keep sticking dollars whenever you can in that car-repair money market fund.