An air compressor has three main parts, a pump, a motor, and a tank. To get these you can go to you local scrap yard, they usually have a few scrapped compressors that can give you a pump and sometime a usable tank, if not with a bit of work you can use a AC compressor from a car, if either of these is unavailable harbor freight tools sells compressor pumps. For a motor you can get one from you local motor repair shop or from a scrapped washing machine, electric lawnmotor, or even a gasoline engine(this one would require a pneumatic clutch). And as for a tank you can use one from a old compressor, but I like propane tanks, you can get from walmart or ameri-gas(amerigas usually have old tanks that have the valves removed I bought my tank for $3)
Yes. It is possible to convert an engine into a compressor pump. They are both piston machines working off of the same principles. It is about the same relationship that DC motors and PM generators have. For instance, there are people who convert antique pumps into hit and miss engines.
On the other hand, people have also converted 4-cylinder engines into a pump/motor, "monoblock" combination by making 2 cylinders air pumps and the other 2 cylinders are left to run normally (with ignition mods, etc...)
http://www.youtube.com/watch?v=Me6h4SNEhBk
1HP=~768W