Nice machine. The Diagonal Lines is the memory test the Classic is doing. If you look at it closely, you will see the lines shift about a pixel or so. Since it is a "long" period of time, it must be fully loaded with RAM.

I have to agree, the analog board needs a recapping and a few other things replaced (Coil, Transformer, etc. What I call the "Usual Suspects"). And what Uniserve says about the speaker, check it out. Should be a simple fix of adding wires where the traces broke.