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Mornin
Please bear with me, this could be long!

Some background. The house is circa 1860. It is pretty solidly built but not from an era where damp proof courses were added. The walls are solid (ie no cavity) and thick. The floor is wooden, with quite a large space underneath before you get to earth. It has horse hair plaster of course!

the plaster around the living room window downstairs has come away from around the window frame in places, it is cracked. The window frame is wooden, set into the bricks and then plastered over.

The wood frame is dry, it doesnt smell, not dusty. The plaster was not mouldy and when whacked with a cold chisel and lump hammer, to take it back to where its still stuck to bricks, seems solid. Its been wallpapered, textured stuff you paint over, but this will be removed before redecorating.

The room doesnt smell "damp", even after time away in the winter.

So, do we have a problem? Should we treat the wood with something before repairing the plaster? if so what?

if the frame is painted get it sanded and paint to under coat stage then you won't scratch / damage your new plaster as you only need a light
sand to clean it / key it before the top coat.

The frame is painted (years of paint, including some scary railway issue colours - bottle green and very bright blue)

but the wood blocks that it is set upon are not, they are the size of a brick end on, are set into the brickwork and I think they go thru the wall, possibly to the outside. The plaster has lifted from around these internal blocks. Should we paint the ends of these blocks?

Should we paint the ends of these blocks?
no.
just nail a strip of eml off a roll across the ends of the blocks to tie the plaster together to stop it cracking,
go from 1 brick joint above to 1 below.
If you only have 1 window or a few blocks and you've got some galvanized rabbit wire mesh handy then cut some strips of that,
plaster won't stick to wood so you reinforce it so if the wood gets damp and swells it doesn't crack the plaster and a lump falls out.

sorry for the delay in posting

Hi,

The timber blocks were only built in as a fixing point for your windows, this used to be very common practice also as the previous poster has said just tack some expamet (mesh) over the timber as this will key the plaster (plaster doesn't really stick to timber).
Your plaster sounds like it has just become dead over time this is not uncommon and you don't have a problem other than replastering the reveals if it is falling off.