Bought a 97 XK8 with 89k miles and want to do everything right: What oil should I use? I'm worried synthetic will cause leakage. I'm guessing just a good quality 5-30 like the owners manual says (not to switch to synthetic)?

and of course the coolant in it is green, not orange, so that's wrong.

 

Russ,
The green coolant may well be correct. Being a Jaguar - nothing is simple. Cars up to vin 010342 were originally filled with Jaguar D985 coolant which is green. Cars from 010343 were originally filled with Jaguar D542 coolant which is yellow. At a later date (somebody here will know but I think early 2000s) ), the yellow coolant was changed to orange coolant which is an OAT formula.
Cars with green coolant should have been changed to yellow under Service Action S813 in which case the expansion bottle should have a little sticker to that effect. I can't believe your coolant has never been changed, but I guess that's possible. Otherwise, previous owners have made the decision to stick with the "green" coolant because they didn't want to pay the very high price of the yellow stuff, and there are very few "generic" alternatives that meet the specifications.
More info on Gus's excellent site here : http://www.jagrepair.com/images/TSB/...%20coolant.pdf

 

If you have no evidence that the coolant has ever been changed and, it can be wise to use some kind of coolant system chemical flush. If your car is equipped with original plastic thermostat housing it's also a good idea to replace it with the metal one while your cooling system is empty, don't forget to install a new thermostat. If you are planning to keep the car you could go even further and remove the intake manifold to get the acces to the heater hoses located in the block valley, at your car's age these hoses are likely worn and cracked from the inside. With the intake removed the thermostat housing replacement job becomes much easier. You could also replace the knock sensors. And at last, the new intake gaskets (under the manifold, under the throttle body, between the manifold and throttle body elbow) will prevent possible air leaks. All these actions are not money consuming (especially if DIY) but they will help your car run 10 more years without a problem.

 

Yellow coolant looks green in the header tank. I'm using yellow in my cars, but a flush would be a good idea.
More important is what secondary chain tensioners do you have. Unless you have service records showing a change to metal body, that should be your first priority. Even if they were changed it's a good idea to check.
I'm using 10W40 synthetic in both of my cars with no leak problems, but your choice is fine.