You can tell that this goes on a lot when a completely rusted 911 gets sold (for the VIN)
Taking almost ALL of the body parts from the 912 may not be illegal, but "altering" the VIN of the 912 is.
You may want to post the Vin number. If the VIN is public, then it is disclosed to all. The seller may be afraid of this happening, if what you suspect is true.
You may still be OK paying what the car would be valued as a 1969 LWB 912 converted to a 911 with a 911E engine. Since it is restored, they will be able to how you the photo of the VIN number behind the dash, for example. (at least on the 68 - not sure about the 69)
Assuming it was a wrecked 911E, and not a rust bucket 911E, you may have "matching numbers", but probably useful to pot the engine number as well. This forum is here to help you. A lot of experts on the board who are very generous with their time.
I am not an expert.
A lot of threads may help, if you perform a search
http://forums.pelicanparts.com/porsche-911-technical-forum/574945-porsche-912-vin-suspicious.html
A 912 conversion still has value - perhaps over 25K.