Honest mate its scrap, the noise sounds like its blowing out the back of the block from the head gasket, the smoke there is unburnt diesel smoke, they pop the gaskets out quite often when they run away (and it probably has due to the fact your original turbo was shot), could waste time pulling the head off, changing gaskets and valves, put it all back together again only for it to spin a crank or main bearing a month or so later,
If you really want it fixed, need to pull the engine out strip it, make sure none of the conrods are bent and the bores are ok, then new shells in the bottom end, new headgasket kit, new good used turbo (don't use a home rebuilt one it wont last) and put it all back together,
Sounds like the seller was less than honest tbf
(ps I break these and fix them for a living seen it all before)