M,

The garage might be correct that it needs a rebuilt or used engine (NOT MOTOR). But to really tell, the oil pan would have to be removed to inspect the crankshaft. If the bearings journals are not scored, a new set of main and rod bearings can be installed. But if the journals are scored, the crank must be reground and to do that , the engine must be removed.

To replace the crankshaft only in an engine with that that much mileage would not be prudent because of the labor cost might be more than to R&R a used engine. Soon something else would probably go wrong with the old engine and then you would have the labor cost again.

Best bet would to be find a good used engine. If you can't find one, a rebuilt engine would be the next best thing, but more expensive.

Running an engine with out oil can also damage the rings enough that the engine will be difficult to start when cold. So you should also replace the rings. And while the head is off, do a valve job.

P E H