As for the sludge, the cleanest engines I've ever rebuilt were on combines. Combines are used seasonally, setting the rest of the time never being started. And when they are used, they run at rated rpm for many hours at a time, never being shut down and allowed to cool off. Next cleanest have been large, high horsepower diesels, these also being used intensly for limited times during the year. And when they are used, they are usually under heavy load at high (for a tractor) rpms. The cruddiest engines are those that are started often, especially in cold weather, used for short periods and never really warmed up thoroughly. Small gas tractors used for hauling hay in the winter are good examples, as are cars or trucks that are driven a few miles to work 5 days a week. The 318 industrial combine engine I overhauled had probably been used for 25 years with no major work. There was absolutely no sludge whatsoever anywhere in the engine. Not in the bottom of the oil pan or inside the valve covers. The small gas tractor I overhauled in spring 2013 was very cruddy inside. I cleaned everything thoroughly and a year later, I pulled the valve cover to adjust the valves. I'd used the tractor probably every other day during the winter for short periods and the inside of the valve cover was covered with an opaque layer of "jelly", a mixture of condensation and oil. Think of pudding and you know what the consistancy was.
The point I'm making is that just because there is an abundance of sludge, that doesn't mean the engine was mistreated or not serviced. The condition of the rod and main bearings should be a good indication of how often the oil and filter was changed of the conditions it was operated under. If there are numerous scores in the bearings, that means big chunks of crud were in the oil and gouged out the score. Which is exactly what the bearing is supposed to do. The soft babbit allows a hard particle to sink into the babbit instead of damaging the crankshaft. Think of stepping on a golf ball on muddy ground. You barely feel it because the ball sinks into the mud. Put the ball on hard pavement and step on it and you'll probably be limping around for a few days if you're like the rest of us old timers. Something else you can go by is ring and upper cylinder wear. If the engine is breathing dirty air, it's going to cause excessive wear on the compression rings, the upper part of the cylinder and even the valve faces and seats. All dirt, even talcum powder fine clay is nothing but ground up rock and that causes excessive wear.
If the oil rings are pretty well worn out but the compression rings are in decent condition, that means a lot of use, but running on clean filtered air. If the oil rings are decent but the compression rings and valve seats are really bad, that means dirty air. If all of the bearings are scored and worn, that means dirty oil. If the bearings are worn and showing copper but no deep scores, that means lots of hours but with clean oil. And broken compression rings are often the result of over-reving, especially if you can see a faint semi-circle the size of a valve on top of one or more pistons. That means serious over reving causing valve float. When I tear an engine apart, I can pretty well tell you how it was maintained and treated. The engine in my parts truck was thoroughly abused. The rod bearings were completely showing copper with chunks even torn out. The main bearings had deep scores and the crank jounals were covered with fine scores. There was a busted ring that had worn the cylinder as well as the imprint of a valve on top of one piston. The hard surface on the cam lobes was flaking away, one lobe was nearly round and several lifters were deeply dished and lots of sludge everywhere. The history was that it had been over-reved quite some time before I got the truck, the oil was seldom changed, it was run on a lot of short runs and I suspect that it was run low on oil for quite some time or was low and used on steep inclines, causing the oil pump to suck air. The upper cylinders were well worn and the valve faces deeply concaved and the seats were rounded, lacking a definate seating area, suggesting use in dirty conditions with poor air filtration. From the look of the air filter that came with the truck, I suspect filter changes were rare and infrequent. In addition the frame was bend as well as twisted from hitting a stump with the front axle according to what my son was told. Yep, a pretty hard life. The boy drove it about 20 miles home for me on back roads because the brakes didn't work and truthfully, I'm really surprised the engine didn't lock up or throw a rod.