Hmmm. Tough call. I tend to try and avoid frankenstein projects for the most part because many times people are just selling their problems. I wouldn't touch it personally, not for 7k. It is a large gamble because you can't even drive the damn thing; there could be electrical problems, interoperability issues between the cummins and 4l80e, the truck could have terrible street manners among other things.
You realize that the way this deal is rigged up you can't drive it until after you hand over the cash and get the trans fixed. He can lie to you and tell you how good it rides and how reliable it is blah blah blah but this is a stranger and you should assume that everything he says is total BS. You won't even know what other layers of problems there are until the truck is driveable.
You should consider that you would probably need a totally new or remanufactured trans out of the chute. All forward gears gone isn't a good sign. Don't forget that you pretty much need to replace the trans lines and cooler too.I love the idea of the truck and if it was properly executed it could be badass. If it was hacked together, you will have an uphill battle.
If you choose to proceed, just be prepared at minimum to plan for a reman'd trans and I would have every mechanic you know put eyes on it that I could to mitigate risk. Personally, I would walk because for me the risk is too high.
I would tell him to replace the transmission and if you can test drive it and it drives good then you will buy it for more. If I were him, I would find a way to get the trans rebuilt or replaced so I could charge more.