Metric Motors shows $2400 "suggested" retail for a rebuilt short block which means they will probably sell it to you for $1900 or so. Unless you are a machinist, you will probably not be able to do much better than that. So that would be your worst case.
I would also be worried about the cam, cam bearings, and valve gear if the engine was truly run out of oil.
You can always take it apart, determine the damage, and then make a decision about rebuild or used.
FWIW, engines can not turn for a variety of reasons. My "dead by the side of the road 280C" was diagnosed as siezed from lack of lubrication, but the real problem turned out to be a connecting rod cap that had come loose.
Falls Church VA
'66 200, '66 230SL, '96 SL500. Sold: '81 380SL, '86 300E, '72 250C, '95 C220, 3 '84 280SL's '90 420SEL, '72 280SE, '73 280C, '78 280SE, '70 280SL, '77 450SL, '85 380SL, '87 560SL, '85 380SL, '72 350SL, '96 S500 Coupe