1991 350 SDL, 149K miles. Oil has been present in the coolant expansion tank for some time now, but vehicle displayed no loss of coolant or motor oil and ran fine.

Until last week, while traveling at 80 mph, large clouds of smoke started billowing out of the exhaust pipe. Engine now starts readily but runs quite rough; white exhaust smoke is present at startup and idle; engine coolant level is now low. No coolant condensation is present on the underside of the oil filler cap. Engine oil is noted to be dripping out of exhaust pipe while the engine is running.

Given the OM 603's spotty hx, should this engine be totaled and a factory reman installed... or, if there is no damage to the bottom end, would the installation of a new cylinder head be proper and sufficient?

I understand the factory reman incorporates a substantial number of improvements.. but it lists for over $11K.