87 IROC problems. HELP!

I just bought an 87 iroc with the 305 tpi. Two hours after i bought it, it threw a rod. I was able to make a deal with the guys i bought it from to split the costs. The problem now is that once i have it fixed, there is a tickin that i hear when i accelerate. It gets louder with revs, but i cant imagine it being the motor, since it only has 200 miles on it. Also, as i drive at a steady 60 mph, the revs go up and down, and i feel power in and out. could it be the trans? or could it be the check engine light on? possibly an O2 sensor? please help!

sounds like a rocker arm, if one of them was not lashed properly then it will click against the valve and pushrod, causing a ticking sound. the surging at 60 mph could also be attributed to this as a loose rocker arm will cause abnormal valve action, and thus poor running of your engine. i would suggest a valve job.