Oh, this is so so common!
I can give you worse than that, on a newer car. My VW Jetta wagon turbodiesel suddenly started belching black smoke and had no power on a very hot day on a visit back to my former home city in Ontario. I took it to the selling dealer--a "Wolfsburg Award" winning dealer no less--where for over $100 they diagnosed that the turbo had failed as the readings came back with no turbo pressure at any speed and that a whole turbo unit replacement was needed at well over $2000. Needless to say, I refused, and drove back from Ontario to the Maritimes--about 800 miles, somewhat slower than usual-- looking like the car was coal fired (at times) just like the old days of diesel Rabbits.
Turned out that the turbo wasn't gone at all, but a plastic pipe on the top of the engine from the turbo to the intake had popped off and so no turbo pressure. Seems that the dealer that sold it to me used had overlooked to clean out the diesel equivalent of the PCV valve where it meets the exhaust gas recirculation unit, so it had clogged and pressure had forced off the plastic pipe.
What irks me, is that the pipe was obviously off the engine--it was rattling against the belt pulley,wearing a hole in the pipe. Since it first happened a short distance away from the dealer, I never checked myself because I drove directly there and trusted the highly paid experts who took two hours for the diagnosis, and whenever I checked stuff like oil level on the way back, the engine was off so no flopping about of the loose pipe, and it fell back into the regular slot. As soon as I took it to a place I trusted on PEI, I turned on the engine and we looked at it...and it was apparent that the idiots at the dealership had just hooked up the computer and never once looked at the engine running.
