a) Check under the air breather cover and see how clean the filter is or if they've been running it without one (very bad idea).
b) Check the oil to see how clean it is.
c) Put on the brakes and push down on the front forks to see if they have oil. A lot of people don't change that oil regularly and it can ruin the forks.
d) Check the brakes to make sure they're not worn out by pushing the bike and then putting on the brakes.
e) Of course check for dirt and rust on the bike. That's a sign that they don't keep care of it very well.
f) This might not be noticeable, but look at the frame and make sure there are no noticeable bends. If someone has been jumping it a lot, it could have a bent frame.
g) Check the handlebars for bends too. This could be the sign of a dropped bike or a possible wreck.
h) Check the gas tank inside with a flashlight and check for rust. Also, if the bike has been stored for a while, the gas will definitely smell stale if someone hasn't used a gas stabilizer.
i) Try and determine if the bike has been stored inside or out in the rain. If the plastic is brittle or bleached, there's a lot of rust, or the seat foam is hard or the cover is hard and cracked, it may have set out in the weather a lot.
j) Check cables/wires for cracks, rust, excessive tape, etc.
k) Look for serial numbers on the frame and engine. Be leary if someone has scratched them out. The bike could have been stolen.
l) Check chain and sprocket for wear and tear.
m) Has someone repainted the bike? If they have and it's a bad paint job, it will only continue to annoy you more and more the longer you own the bike. Repainting is not a job to be taken lightly.
n) Check to make sure the bike has been greased regularly. Check the swingarm and wherever else there's a spot that could use grease. If someone has not kept proper care of the bike, moving parts that should be greased will often be dried out and tight.
o) Of course starting the bike succesfully without having to break a major sweat is important. Never accept the excuse that: "Well, it usually starts on the first kick." or "All you need to do is clean the carburator and change the plugs and it will run great." A well cared for bike will start fairly quickly. Feel the engine before starting it to make sure that they've not just got it running so that it starts on the first kick when you show up.
p) Finally, glance around at the rest of the seller's yard, shop, etc. You can usually tell what type of care someone gives their bike by the way they care for everything else they own.
Some of these items may not mean that the bike is not worth the money, but the more that accumulate, the more wary you should be.
Have fun and ride safe always!