Piston slap... depending on how bad it is, you might wanna budget in a build for it with oversized pistons (or a later model short block). Generally, light piston slap will go away once the engine warms up.. you can also try heavier oil to see if that aliviates some of the trouble (thats a temp fix tho).

Eventually one of a couple of things will happen.. the pistons will wear the bores so badly that the rings no longer seal and the engine loses compresion..
piston skirt cracks and the engine throws a rod, or, nothing happens (not likely ;) ).

both of my 87's have piston slap pretty bad, my 740 is starting to burn a noticable amount of oil, so I don't expect it to make it too much further.

One thing thats been noticed is that turbo cars exhibit piston slap far earlier than do the NA cars, I've talked to a couple of mechanics about it, and a couple of people that build big turbos for high powered cars, most of them said that a lack of upper cylender lubrication is why, and worn rings coupled with the hair dryer hastens the onset (oil squirters might be a solution to the problem... this problem is not limited to volvos, the 2.3l turbo chrysler motors also had it)

Unless you can't stand the noise or have an abundance of money to throw at the car, I'd just drive it until it breaks (early b230 motors generally aren't worth building... it'd be cheaper to snag a late model engine, or get a worn later model short block and re-ring it)

just my .02 :)