I just read through the whole of the thread. I feel for you having to lay out yet more dollars for the engine after everything you've done. If it was me, I would definitely go for an engine with a warranty, but that being said, i would also look to try and upgrade the engine whilst am there. If you're spending say 3-4k, you might as well spend a little more to bring a smile to your face rather than get you back to where you were previously. At least that's my philosophy.

I don't know much about the GM motors, but if you're shopping around for an engine, could you get one that's been worked on ? i.e. maybe some ported / polished heads, or cams. Or even play with the displacement. If you can get someone reputable to do it (you could still get it warrantied). It's just the way my mind works I'd be trying to pay GM to max that puppy out !

 

the engine is definitely seized