repairing engine block is a common practice in mkt, the machinist who will do it give you guarantee of 6months to 1 year. If you get the block repaired you'll save a lot of money considering that there are no damages in cylinders and the engine parts will be placed back. Depending on the machinist a repaired block works equally good, seek advise from a few taxi drivers (usually these people adopt the cheaper solutions), also ask around for the best machinist.
Now, as far as replacement is concerned it is highly recommended the only issue is the condition of kabli engine or head block, in most of the cases these items are rusty from internal water jackets and would give you an excellent performance on a test bench but the moment you fit it in your car and it gets some load it cracks. Now here again you'll need an expert mechanic to inspect the engine and some link to the shopkeeper to point out which engine is better, newer, etc.
the kabli engine is also waranteed for replacement for a few days but it is big headache of putting it in your car and if you are not satisfied then replacing it, not to mention the expenditre
Wish you best of luck