To begin with VW engines are a dime a dozen. That approach is not practical on your car unless your engine is totally trashed.

I don't think that I would replace engine over an oil leak. To begin with, where is the oil leak? Most likely it is the upper timing cover gasket and relatively easy to fix. The next most common source of an oil leak is the head gasket, but not near as likely.

If you will be specific about the ills of this car, the odds are we can point you in the right direction and get it back in shape with some work on your part. I fully expect it to be much less complex than changing engines.

The bottom of these engines from the engine deck down last virtually forever if oil and filter are kept changed. In most cases the most that needs to be done mechanically is to do a valve job and replace the head gasket.

Find where the oil is coming from. You may have to wash the engine to find the leak. Then also tell us what is not right about the engine or how it runs, and let's get to some diagnostic.

Good luck,