If the engine is less than 10k on it, do a compression test and leak down test. They should all be about the same in each cylinder with less than 10k on engine. If not then I would worry about the engine.
If you think $3500.00 is ok for the truck then it is Ok, But it never hurts to try to get it for less, if he is firm on the price and you don't think it is worth it, then that is when the whole "seller vrs buyer" thing comes into play. Without know more about the truck or seeing pics,it is hard for anyone here to say it is worth it or not.
Irish is right, the axle's alone to most people are worth $2 - $3k, so there is something to think about.