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You're in UK, right?
I just reviewed some photos of my last coolant and stat change on the 940 at 165k mi. There is somewhat the same amount of crud around the gasket/seal surface, but the insides are surgically clean, shiny alloy. I got the car at 133k mi and do not think it was all that well serviced by the P.O. I've used garden variety ethylene glycol (Prestone Brand) and distilled water, with two flushes in the past three yrs.
I see Green coolant in your pic - I thought the Volvo stuff was a Blue colour? Anyway that is a strange sight for an engine that has been serviced as you say. The rust particles have to be coming from the block. Try removing the block drain apparatus beneath the rearmost exhaust port in its entirety and scrape inside there with a bit of hooked wire and see what you pull out.
There's corrosion going on for some reason.
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Bob (son's 81-244GL B21F/M46, dtr's 83-244DL B23F/M46, my 94-944 B230FD and 89 745 (LT-1 V8); hobbycar 77 MGB, and a few old motorcycles)
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