It depends on how much you love the car. Kelly's Blue Book gives it a value of about 2400 in fair shape with the head repaired. Keep this in mind as this is what you should expect to get for it once repaired. For some reason some people seem to buy these cars for far more than they are worth. Add on to that above average maintenance expect there is no wonder they get a reputation for being a money hog. For me i would not have the head on my Mercedes done professionally (would likely do it myself) as I would never see a return on the money, and while I like the car I do not love it. My Miata I would do it in a hart beat even though I would never see the money out of it. So it is a combination of what the car is worth and how much you LOVE it. You might want to consider just finding another one with fewer miles and see if one of the mechanics wants to give you some money for the car. If your car had no other problems then you might want to repair it.

Just some things to keep in mind.

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Currently
1991 Mazda Miata 174000
1991 Subaru 189,000 Winter beater

got rid of:
1984 VW Vanagon 195,000
1976 350SE Euro 185,000 KM
1973 280SE 4.5 (boy do I regret that)
1980 280SE European W126 4 speed manual (miss it)
1989 BMW 735iL 119000 (good riddance)