So when he said the seller "already knows something you don't," did he mean the product is fake or that it's stolen or what? Like what's the actual thing they know that makes it so cheap?

Sealing every crack with silicone worked way better than spraying for me too.

Those timing gears in the AE-1 are nylon and they get brittle with age, so it's less about the teeth wearing down and more about them just cracking off after 40 years. Seen it happen on bodies where the timer was never touched too, sitting on a shelf is enough. I keep a coffee can of dead AE-1s for exactly this stuff, way cheaper than hunting donors one at a time.