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Hi Phil,
Well, if you determine that the sound actually is rod knock and that the engine does need to be replaced then I can't see why the '88's B230 wouldn't just drop right in. You'd probably have to keep the 740's wiring harness and might have to swap a few things here and there, but I believe the fuel systems are the same. I don't know why you'd have to swap the cam, but you may have to use the bellhousing, flywheel and flywheel sensor from the 740. When my mechanic rebuilt my '91 B230FT he swaped the distributor from the back of the head to the front of the engine because it's a more simple design: Works great, I believe the distributor parts are cheaper and it can't leak oil like the rear distributor (yay!). Good luck!
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Chris. Halifax N.S. '91 745Ti, 290K km and '91 745 NA, 380K km.
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