From what I've heard in other forums this is a common problem in the 3.8l block. The dilemna I'm faced with is whether I should just ignore it and rebuild the engine as there was no loss of coolant nor mixing of oil and water, and just hope for the best?
These are not common for S38 engine blocks. There is one reason alone for this: Hydralock. With other words. Some jackass mechanic forgot to remove all the oil from the mounting holes before torquing the headbolts.
yes I've heard that mentioned. From the receipts of the PO the engine was overhauled by an official BMW dealer who charged 11,000DM back in 1999 when the engine at 140k km on it ( 70 clicks more than now).
Yes, its certainly possible to X-ray it but I think that will not be necessary.
I would find a reputable engine rebuilder who Im sure would be happy to help with an opinion if you are attempting to do the job yourself.
I cant see how far the damge has gone & nor can anyone else from pictures.