If you want a black bike, with a black engine, a Nightster isn't the way to go. Nightsters have a medium-grey engine, the formal nick-names for which I've never heard, but the work "ugly" comes up, a lot. It's far easier to paint the tins than it is to paint an engine. 1200 Customs are a great starting point for a murdered-out scoot. Although, they come with a chrome primary and cam cover. The bike in your pics, is a base-model 883. I think, IIRC, '07 was the last year for a base 883 (XL883). After that, I think, the Motor Company went to an 883 Low (XL883L) for the lowest buy-in. Roadsters, depending on year and model, have black engines, jugs, heads and covers, with nifty dual-discs in the front.
Both my bikes have blonde engines. They go well with black and chrome. Plus, they match the grey pin-stripes on my tins. Absolutely nothing wrong with black or, ummm, medium-grey engines, though.

I can dig it. The 1200 jugs I bought, are blonde.

Those jugs have polished fins. Not uncommon, especially pre-2008.
The OL's '04 1200 Custom:

 

You could try the butt dyno. 0-60 mph are about 3 seconds apart. 4ish vs 7 ish.

 

Steer clear.
Just an opinion, do what you want, but I think you can find a straight up 1200 for that price range if you look around and are patient.
I've been burned a couple times so now when my "radar" sends back confusing signals I bug out.
Also, all conversions are not equal, and the quality of work varies widely.

 

update...

Bike is still registered in old owners name and the seller said that the compression test shows it is at least a 1200 ????????

Will steer very clear from this one.

Found an '09 XL1200N for about $800 more with 6,000 miles.
Looking at it this weekend.

Thanks again

 

That is half the mileage of that 883(?) you were looking at and newer to boot. That was my call some months back when I bought my XL1200C. There was a 2002 1200 with 19,000 miles on it 4 blocks away for sale. I took it for a ride and it didn't sound or "feel" right. The owner was evasive about some questions I asked and also wanted $5K !
I looked on CL the next few days and found a very clean 2009 XL1200C with only 3,890 miles on it. . . dealer stored and service every winter. . seller had and gave me all service papers. I had to drive 35 miles to see it. Got it for $500 more than the 2002.

 

OP, I believe there is a pad on the bottom corner of the jugs, that will say "883" or "1200" It would be on the bottom, up against the engine case. I don't know if you can see it with the jugs on easily, but it is there.

 

Smart move OP.