I was inspecting a used car and the oil and the transmission dipstick smelled of exhaust (carbon monoxide?). What does this mean? Does it mean that the engine's gone bad and I should stay away from that car?
First of all you're not smelling CO (carbon monoxide) as that is an odorless and colorless gas. What you are likely smelling are combustion byproducts and that is not at all uncommon in the engine oil. The transmission oil is another story and I suspect you are just smelling the oil itself.
The thing I'd be concerned about is a sharp "burnt" smell that indicates overheating or other heat-related issues.