Have you done a compression check? I would suggest doing a compression check. If the compression is okay, you might get by with only the valve seals. If it is low, squirt oil in the cylinders and recheck compression. If it comes up then it is rings and tells you that you need more than a valve job, if it doesn't come up, then the problem is the valves and you need to do a complete valve job.
I recently had head problems on my M103 engine, removed the head and took it to a machinist who is very experienced with these heads. The result was outstanding, and I was very impressed regarding how well this head comes off and goes back on. There are many cars these days that are made to throw away after they are used up, this engine is not one of them. These engines respond well to head work, and they do not have connectors that crumble when you try to remove them.
My engine at 170,000 miles still showed crosshatch on the cylinder walls, I would expect that this is what you will find inside yours providing it has had adequate oil changes.
Best of luck,