Did the shop where you sent it get it running at all? I'm going to have to call BS on their diagnosis unless they've done enough work to determine what kind of knock you're dealing with. It's impossible to diagnose a knock if they're doing nothing more than spinning the engine at cranking speed for a compression check.

Call the tow truck again, and get that rig to a real mechanic! It's entirely possible the next thing you hear is going to be a really lowball offer from the shop that's reccomending the engine work to "take it off your hands". At least get a second opinion from someone not associated with the shop that's working on it now.
Jerry

"It is better to be silent and be thought a fool than to speak and eliminate all doubt!" - Abraham Lincoln
Cringe and wail in fear, Eloi- - - - -we Morlocks are on the hunt!
There is nothing noble in being superior to your fellow man; true nobility is being superior to your former self. - Ernest Hemingway
Love your enemies and drive 'em nuts!