A quick site search:
http://www.xs650.com/forum/showthread.php?t=1131
http://www.xs650.com/forum/showthread.php?t=367
3) Compression - probably the #1 cause of problems with Barn finds and un restored bikes (once you get a new battery).......
These old bikes had pretty high compression, and most don't retain it after years of inactivity - even low mileage bikes.
Beg, borrow, or steal the use of a compression gauge - only takes a minute to do.
Warm engine, throttle wide open, no choke. Take readings at both spark plug holes a couple of times.
If it won't run, take the readings with a cold engine - generally only about 5 pounds or so less than a hot engine.
If the compression values are acceptable, resist any temptation to mess with the engine.
If the numbers are unsatisfactory, stop now, you have some serious problems. You are looking at a top end job, could cost you anywhere from $150-$300 or more, depending on what you find.
It is pointless to try and get the bike to run well; its not gonna happen, a waste of time and money.............
These are incredibly tough old engines - they will try and run for you no matter how bad they are, but don't be fooled.
Examples of MINIMUM compression values before top end rebuild is indicated
under- 100 psi poor
100/125 psi good
125/150 psi excellent
both cylinders should be within 10% of each other