Exactly like it sounds. What are the challenges, if any, of fitting a near perfect 850 drivers seat into a first gen V70?

Seatbelt hook up is different, you could swap the rail on the outboard side of the seat so the V70 belt will attach. Be very careful with this, the alignment of the rail is precise.

If the 1994 is a turbo, it will have an air bag.

But if it is just the leather, swap the leather. The seat heater on the V70 also heats the bolsters, not just the center panel. It does take a couple of hours to remove the million hog clips and replace them with zip ties, but I have done this about a dozen times.

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Keeping it running is better than buying new

Done the hog ring thing on about 12 seats over the years...Gotten pretty good at just cutting them.

As long as the upholstery will swap, that is the plan. Have a potential parts car for $250 and a 3 hour round trip. Waiting to hear back from the guy.

Seat skins swap from 1993 to 2000. I haven't tried anything newer, too cheap to spend $20 for a 2004 seat. I would love to find some "R" seats for my 1994T.
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Keeping it running is better than buying new

Not 100% sure, but I think it will slide right in....

Potential issues:
1. You may not care about the following but if you install the 94 seat you will no longer have a side air bag. The 94 850's don't have a side air bag. First year for side air bags was 1995.

2. Is the 94 a manual or power seat? If it is a power seat the wiring is different on the 98.