First, you say the cylinder just passed hydro. Sounds like he is also willing to document it passes a visual inspection - but then he does want to sell the thing, so even if he is qualified/trained on the visual inspections, one can question whether he performed an unbiased inspection evaluation.
Having said that, unless really abused I doubt an aluminum cylinder from 1999 would fail a visual. I would expect worse case to be that it needs a tumble/cleaning. But you are not using it for breathing air, so that is less significant. And yes, aluminum can oxidize, but it generally just forms a very thin oxidized layer and stops, not like steel than can rust deep pits in the metal once it starts. So it is unlikely that he "doesn't trust" it. He just may not run his compressor over 3000psi, if the plan discussed is to get fills from him.
Valves: here are examples of the two basic valve types
Yoke:
XS Scuba Deluxe K
Convertible (DIN w/screw in yoke adapter):
XS Scuba PRO
That $100 valve sounds high, although that is the MSRP for a less common DIN/yoke convertible with a hard PVD finish.
The $150 + $30 price is not unreasonable, but also not a great bargain. If you have a local dive shop, you may just want to get aquote on a new cylinder set up the same, for comparison. The major variable is whether they are able to meet free shipping minimums or if they need to pass along freight costs. There is not a lot of margin in tanks, and it is difficult to set a price on a used tank that makes both parties happy.
I'll leave it to others to comment on carbon cylinders from China.
