1997 4Runner misfire/piston rings?

my father in law has a 1997 4Runner SR5 4x4 and he has a power loss problem and it definitely sounds like a misfire also. He took it to his shop and he said that compression on his 5th cylinder was very low. It isn't smoking and he had the head gasket and all that goes with it done a year ago. He is under the impression that the it isn't worth fixing with 200k on it and He said if it's worth fixing I could have the 4Runner so I am trying to get it figured out. What else should we check when starting this diagnosis. There are no codes as well. Thanks in advance!

 

Well we are uncovering what we think is a scam by his car doctor. I pulled all the plugs today and tested the compression in all the cylinders and these were our readings.

6-175psi
5-180psi
4-175psi
3-155psi
2-175psi
1-170psi

Looks like cylinder #3 is lower but still within decent reading. I replaced all the plugs and plug wires and the mechanic claimed he replaced the plugs when he did the head gasket early this year. Well the plug in cylinder #5 was REALLY old and nasty and was an autolite brand while all the others were fairly new NGK's. That was our first tip. I then did some snooping around and noticed that it looks milky when I took the oil fill cap off. I then checked the oil and it was nasty, milky oil. After replacing the plugs and wires, the misfire was gone but it felt sluggish (Understandably from the head gasket that was either never replaced or was not put in correctly resulting in the milky oil). My father-in-law will be taking it to another mechanic this week to have it inspected so we know what we need to do about the other mechanic. The mechanic that fixed the head gasket was also the mechanic to diagnose the low compression in cylinder #5 and said it really wasn't worth fixing and to drive it until it dies.