engine failure....swap 617 for 602 engine?

[cgunderm]

Hi....
not been having a lot of luck with my wagon. Second engine. 1980TD non turbo. My current engine has about 210K on it. A week ago, it started loosing power, idling rough, smoking a lot. I drove it up to a mechanic friend's shop around the corner, we opened the hood, and there was this inordinate amount of smoke coming out from the crank case hose. When he plugged it with his thumb, the engine stalled out immediately. Lots of pressure in there. I was initially hoping that maybe just the valves needed adjusting (I ran Lubro Molly injector cleaning last night, changed air filter etc., the usual stuff). But he thinks that there must be a hole in a piston for there to be so much blow-by. One cylinder is not firing at all anymore.

Last month my 1993 300D 2.5turbo was totaled on the road by an idiot that rear-ended me, driving at high speed without looking (his dog leaped in his lap, he claims!). A total wreck, but I climbed out of it intact, not even with a lot of whiplash. That car is so well built for that kind of collision. Anyway, of course the insurance doesn't pay replacement value etc. etc. That car was in immaculate shape. I kept it as a parts car. Just bought another 1993 2.5 turbo, picking it up today. But here is my question: my mechanic friend thought that I might somehow be able to rig for the engine of that wrecked 2.5 to go into my 1980 wagon. I have a manual transmission in the wagon from a 240D. Does anyone have any experience with swapping a 602 engine into a 123? Can it be done? My friend thinks that the hydraulic pump for the rear suspension could be run off an electric motor.....

Any ideas?

Thanks!

Christian