Land Rover Repair: Land Rover disco engine at end of its life. What do I do?

Question
I bought a 2002 Land Rover Disco about a year ago as my first car for $4,500 and it was in great condition. I saw it sitting in a used car dealership while driving home from my summer internship. I test drove it and immediately fell in love with it. The previous owner had installed a new sound system and that pretty much sealed the deal for me. I made an incredibly bold decision and just bought the thing. I failed to do my research and was completely uninformed about the TLC that this car was going to require. It recently broke down. My dad took it to a mechanic who replaced the cadillac converter. He got it to run again but it now had a slight ping in the engine. This ping later progressed into a violent knocking and shaking. Sometimes the car runs properly if it is choosing to cooperate. Often times the engine will just shut off if I am stuck at a red light I have to put it in park and turn it back on. The same thing happens when I shift the car into reverse. I have to keep turning it back on until I have reversed as far as I need to. The brake and the steering wheel are both incredibly stiff while I drive and I no longer feel safe driving it. A friend of mine said it sounds like an issue with the alternator, my dad says I have a bad engine valve (or thats what he was told by the mechanic that got my car running again) and that I should just sell the thing. I doubt I will get much out of selling it to buy myself a new car though. I'm not sure how, but someone actually managed to steal my brand new front bumper and the fog lamps off of my car as I was at work (apparently people are doing that now??!) I doubt I will get anything for it with a shot engine and the missing front bumper and fog lamps. I am way too sad about the thought of having to get rid of it, the interior is still beautiful as if new (except for the suede on the driver seat door being a little worn)and it has a nice sound system with bluetooth and a USB outlet. The leather is barely cracked at all. I am having a hard time finding any cars that fit my budget that have the same quality/amenities that my land rover had. However without a properly functioning engine, who would want it? I found a used engine for $900. I could definitely afford to purchase it, but is it worth it? Am I just going to run into the same problems? and how much would it cost in labor to have it installed?
Are there better options?
This car has got me in a tight spot and I feel like I'm going to lose either way. I don't know anything about how an engine works and I'm not going to pretend to. I do know that I most likely cannot afford to deal with whatever is wrong with it. Buying a used engine seemed to make the most economical sense to me, I'm just not sure how much the labor costs, and after reading your blog I feel like I'm only prolonging my car's life by just a hair by doing that. Am I just pouring more money down the drain?
I don't know enough to make the right decision.
Do you have any advice? Or possibly a better option?

Answer
Hannah, the sad truth is that it's going to cost $7500-13,000 to do an engine in your Discovery, and it sounds like you do not have capable service around you to keep it going.  The problem with foreign cars like the Land Rover is that mechanics who understand them are few and far between.  It does not sound like there are any experts near you, or if there are, you have not found them.

You would probably find many similar amenities in, say, a 4Runner or a Grand Cherokee, both of which are probably easier to get serviced