The repeated diagnostics is bad. It should stop and hunt for a disk in the drive, and stop with "RETRY" on the screen. It's finding something wrong. On the other hand... all of these machines need TLC to keep them running. You would need to pull and reseat all the chips to make sure they're all making a good connection. That cures 98% of failures. The keyboard, on the other hand... that's much harder to fix.
Talk him down due to the diagnostics being bad. And, if you weren't aware of the keys before... talk him down some more because of them. None is critical to operation (caps lock, the number on the keypad), though.
Edit: I see one of the keys on home row looks broken too... this machine's lived a hard life.