Which engine? B20E or B20F? If it's the latter 135 across the board sounds about right, but even so, if it's even on all cylinders I wouldn't fix it because it ain't broke. Irv Gordon (i.e. mr. 2.8 million mile 1800) is quoted as saying that rebuilding the engine on his 1800 "just because" was the biggest mistake ever.
VOLVO FOR LIFE!
It's a B20E. The bottom end has never been touched and to my knowledge (previous work receipts) the top end has never benn reworked either. A couple cylinders are lower, I think 155,135,140,150 IIRC. It's running well so I will leave it alone. I have a complete bushing kit for the front and rear as well as the driveline. this work is daunting without a lift and air tools so I have been putting it off.
I have some seal leaks so I get a few drips but again I will correct if I ever split the transmission/engine. The 1st gear synchro is worn and could use replacement.
Yes. The air filter (drum shaped and about the size of a watermelon) is accessed through the grill. It must have been oversized to deal with the dirt/gravel roads of Sweden.