Rod Bearing advise needed for 5-spd.
 

So I finally got to test drive my New 5 spd! But on the test drive around the block I heard a slight knocking sound, and noticed my oil pressure hovering between 0 and 1. BAD!!! I shut the car down and got it back to the house. Pulled the oil pan and sure enough there are shavings of metal and the #2 rod bearing was totally shot. When i removed the oil pan there was a 2" rubber grommet sitting all by itself in the bottom of the pan. I pulled the rod cap off, The crank journal has some slight grooves in it. My Mechanic friend recommended polishing the crank journal with some 220 grit sand paper the best I can, then buy a new rod bearing, put it back together and drive it.

The last time i worked on this car about a year ago, I removed the oil pan because I was replacing the turbo oil return grommet thingy, and I'm wondering If I did not install all the rubber pieces for the oil pick-up system properly. It looks as if that rubber grommet I found sitting in the bottom of the pan may have been hindering the oil pick up.

I got this engine from a diesel mechanic friend of mine who bought his 126 new in 1984. Four years ago the car had 186K miles when his wife totaled it and he sold me the engine. The thought that I may have damaged/ruined this engine is devastating, I thought I was going to drive that engine for the next 30 years in my 5-spd 123. Now I'm just sad.
I took the rod cap off and the crank journal does have some small grooves. The car was not run very long with low oil pressure, but there is no way to know the extent of the damage in the rest of the engine that i can not see,

Thoughts?

That doesn't sound great - perhaps some pictures of the damage will help with a more informed reaction from us all on the forum?

Generally speaking I'd be inclined to replace anything that is damaged. But then I always fix things like I'll be buried in them!

Pull the nuimber one connecting rod cap and examine the bearing. If it looks pretty fair plastigauge it. If wear is well within limits cleanup and replace the number two bearing. If worn pretty badly as well the engine will have to come out.

Make sure the rod caps are marked as the original orientation of them and location is critical.