oh yeah, so since there is air flowing through (seems like a normal amount) is it ok to drive without worrying about messing anything up?

I would assume it would be ok, but obviously I can't give you a "clean-bill-of-health" over the internet (but making sure the oil, tranny, and coolant levels are good should be sufficient for now). It sounds like a fun project ahead of you. Start with the easy stuff first like fluids and filters. Change your oil and filter if you haven't done so already, tranny, differential, air filter, coolant & thermostat, fuel filter, etc. Clean your flame trap (if present) and check your air-box-thermostat right away since these two items can induce very expensive repairs later down the road. (I have my pre-heat tube disconnected in the summer time so I don't need to worry about an airbox thermostat failure if it should occur.)

Regarding poor vehicle response, make sure that you don't have a vacuum leak anywhere. Remove the accordian tube between the Air Mass Meter and the throttle body and inspect it for tiny cracks (can be temporarily fixed by a good cleaning and many wraps of electrical tape). Also check your vacuum hoses for hard or split ends that would comprimise a good seal.

but also it's loud because i have a blown gasket between the manifold and exhaust pipe,

I think FCP Groton has these pretty cheap and of decent quality. www.fcpgroton.com

Also, get yourself a copy of the IPD catalog. They charge a bit extra for their parts, but their service is pretty good (and the catalog is excellent quality and filled with tech tips). As always, shop around for parts before you buy in order to get the best prices. A lot of the replacement parts you'll need down the line were originally built for Volvo by Mann (oil filters), Febi (bushings and engine mounts), Boge (bushings and shocks), SKF (bearings), Bosch (sensors), Bougicourd (spark plug wires), TRW (suspension & steering parts, tie rod ends, and ball joints), Elring (gaskets), Caloristat (coolant thermostat) and ATE (brakes). The above listed companies build great parts and should be considered the best quality in most cases. If you're not buying an OEM part, check the companies reputation. ScanTech and MTC re-sell a lot of parts after branding them as their own, some are good and some are not (avoid ScanTech suspension bushings unless you like changing them again in 6 months to a year).

it seems as if that 13mm nut has been spot welded shut

A service shop may have broken it when hooking the vehicle up to an exhaust gas analyzer. Rather than get a new fitting and a new nut and welding the fitting in correctly, -they just spot welded it together and sent the customer on their way.

God bless and drive safe,
Fitz Fitzgerald.
--
'87 Blue 240 Wagon, and my 240 has 240K miles.