Land Rover Repair: Disco engine ticking/knocking, warranty repair, independent shop

Question
Hello experts! I am really glad that I found this website. I need help and advise regarding me beloved 2003 Discovery.
We purchased the car in February 07 with 44,000 miles (The Disco is under extended warranty). We drove it for a month then the engine developed a ticking/knocking noise. I took it to the LR dealership (later I found out their reputation is not that great) in the beginning of April. Two and a half months later, we got it back. They dropped in a brand new 4.6 tripped engine because “cylinder #6 has low compression”. The service manager said the tripped engine includes “the block, piston, connecting rods, camshaft, oil pump, front cover and oil pan”. I noticed the ticking/knocking noise is still there but a lot more quite. The service guy said ticking and knocking is a “character” of the rover engine. I am not buying what he said. It is a new engine, how could it tick and knock? The only reasonable explanation I can come up with is they did not give me a new engine, they only cleaned my old one. I took it to an independent LR service shop in town to have them take a look, they looked at it for 10 minutes and could not determine if the engine is new. They said in order to drop in the new engine; the front clip or the hood has to be taken off. But there is no sign of that. The serial number on the “new” block looks dirty. On the other hand, the oil pan and front cover is really shinny and looked new, and the Disco is consuming a lot more fuel which could be a sign of a new tight engine. The independent shop said the only way to tell is taking the engine apart. Since my extended warranty repair has to be approved by APCO, I called them to require some information. APCO said they only approved an engine repair, not replacement.
I guess my million dollar question is “how do I know the engine is really new”?
Thanks in advance.  

Answer
Hi Lu,

lift off the valve covers and take a look. IF its not a new engine, those valve covers will have a coating of sludge.  Top of the valves and lifters themselves will also look 'baked' if the engine is not new.

Removing the valve covers is not an easy chore.  If you know of an independent LR mechanic, you should hire them to take a look.  

If you live in N.America, send me an email and include the city you live in. I will ask around other LR owners for a reputable LR mechanic on your behalf.

Regards,
JohnMc
jmcinnis64@hotmail.com