First, make sure the electronics and accessories are 100% before you rebuild the motor. hate to blow a hole in a brand new piston running lean from air leaks or something.
Personally, I'd never rebuild an M motor myself again, I did it once and it was a nightmare. several problems:
-new oil pumps cost an arm and a leg, no aftermarket options (that I know of any way). Is it REALLY needed? no but it's not a bad idea. I've never heard of a failed oil pump on an M motor but I wanted to be sure it was ALL new
-oil pump shaft bearings: none fit, even toyota. I got them from 4 different places (And different brands) and ended up honing out one to fit. couldn't reuse the old one cause I cooked the block to clean it.
-wrist pin bushings: again, none fit. even from toyota. again, I just honed out the cheap ones to fit.
-head is a PITA to clean out all the little passages, and there are some really little, really clogged ones. <1/8" ones between the exhaust ports.
-in the end I spent about 1200 in parts for a slightly higher compression (albeit with MHG and ARP head and rod studs) POS 7M. If I'd put that into the 2J sitting in my garage, I'd have a bulletproof killer motor in the car. now I've got a freshly rebuilt 7M I'm not totally sure about cause it's a POS 7M that I had to hone out bearings to fit and therefore don't know the oil clearances on those parts. The only good thing about it was I had time and space to make blockoff plates and swap throttle bodies to dump all the emissions stuff and the CSI.
1200rpm idle... could be a lot of things, cleaning the air box won't help. you could try cleaning the IAC and TB but no guarantees. I'd suggest going down the troubleshooting list in the TSRM.
If the noise is valve noise, it's from the valves (there are no rockers on the 7m) get a mechanics stethoscope and check it out. could be mains, rods, wrist pins, or like you said, valves. once you get the valve covers off you can check valve lash with a feeler gauge and see if that's the problem (see TSRM again) the rest you'll just fix by replacing all the bearings.
The dealer will charge you out the butt to do anything and unless they have a particularly good (and expensive) body shop it won't look any better than if any other shop did it. maybe better than if you did it yourself. just don't go to maaco or jim-bob-joes paint shop cause it'll look like garbage even 20 feet away.
the auto in the cressida isn't (to my knowledge) particularly harder to rebuild than any other auto trans. at the same time though, I'd never rebuild any auto unless my life depended on it. did it once, half successfully (did a chevy 700r4, which is supposed to be pretty easy, in school. took it apart again more than once and it never did run right)
