I'm the original owner of a 1991 350 SDL with 177K miles on it now. I would like to keep it.

Engine has been relatively trouble free but head gasket now has a small external leak in the rear on the passenger side. No indication of leaking into the motor. Motor runs fine otherwise.

Indie shop I deal with is not thrilled with replacing the gasket and suggested I try K&W Block Sealer to fix it.

I have a good relationship with the MB dealer where I originally bought the car and they will replace the head gasket for $1,800-$2,200 including a new timing chain (my idea). I have confidence in them and their senior diesel mechanic and I have gotten along great over the years. This mechanic said we could be opening up a can of worms but is happy to do the head gasket job. He wil also do a compression test.

I'm wondering if we should do a valve job while we have the head off and neglected to ask what that might cost? Would appreciate opinions on whether or not to do the valve job? The engine uses about a quart of oil every 1200 miles, mechanic says this is typical.

This car is in otherwise excellent condition, looks great and everything still works.

Am I missing anything else that I should consider here?

Thank you.