JetsonES

Ouch, sludge city. Cleaning it out is an option and a cheap one at that. I would give it a shot because what do you have to lose if you're looking at a new engine vs trying to clean it up. I second Zach's advice, rebuilds seldom last as long as factory assembled engines in my experience.

Ravencrave

I have had the same problem with sludge. I had nothing to lose at that point than to just clean it up the best I can. I had to run Marvels Mystery oil a couple times and change the oil every few hundred miles about 3 times. Had to drop the oil pan each time and clean the pickup tube where the screen is located. Now 50,000 miles later, no issues and I'm running Mobil 1 synthetic.

mooseboy84

That was some major sludge.Any update on what you did?