If you do the assembly yourself rebuild will be not too bad. Talk to your volvo guy he will be the best local source, shipping an engine will cost $$$ and cut into the value of a unknown used engine. A decent engine rebuilder should do the machining for $500.??? who knows...like I said the more of the dissassembly pulling etc that you do yourself the cheaper, also you will learn a bunch. These engines are very simply to tear down and rebuild BTW you need to investigate further, find out why no comp in 2 cyls, could just be the cam shaft....who knows. You will need a back up car or public transit for awhile no matter how you look at it.
Finally my ma had a car( 145) "stolen" from her by a nasty volvo specialist. He told her the motor was shot, bought it from her for scrap price turned around and sold it a month later with the same engine in there. I was 10 at that time so I couldn't do the rebuild yet.
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Patrick, '68 220, '92 Eurovan , '53 PD4104 (highway coach conversion).