Engine failure need help

Hey guys, (FROM AUSTRALIA)

New to the forums but have been reading for some time. I own a 2010 MK6 GTI 58,000kms

Long story short my car pretty much randomly started making a loud knocking noise coming from the bottom of my engine, mind you i stopped driving as soon as I heard this problem and also checked oil, no lights came on the dash what so ever (oil, engine etc). Oil levels were above low, after leaving it and starting it a few days later the oils had completely drained, I then filled it with oil and left it. I had it toed to VW and they have diagnosed the problem as quote "it appears to have been a failed securing bolt for main bearing cap 5 which has caused oil starvation from the bearing cap lifting under load resulting in further damage to connecting rod bearing cylinder 4 hence the knocking inside the engine". Supposedly there is a heap of metal particles in my sump and in and around my engine and repairing this engine is not possible or cost effective.

I originally took my car to VW to be looked at for a goodwill fix, after they diagnosed the problem vw Australia denied the claim they said my car is to old. I have taken this up with VW Australia and am getting it assessed again as I am not happy with the outcome. Correct me if I am wrong but is this not a manufacturer problem? As i mentioned my engine or oil light never came on and my car gave no signs of problems so it is not like i was driving it whist it was damaged, the noise literally happened out of nowhere and it was very loud.
Does anyone have experience with dealing with vw aus or any vw's with good will? what do you guys think of this? They have quoted me 12k brand new engine and 9k for second hand. I have already found some secondhand engines for 3.6-4l with decent k's but am hoping for the best with vw.

Can anyone give me advice with dealing with VW in regards to goodwill claims?

Apart from the usual buying/selling websites where would be the best places to look for good quality secondhand engines?

Is my engine definitely unrepairable?

Located in Australia Melbourne

Im sure Im not the only person that has heard some horific stories about taking cars to a dealers.
The replace and dont repair culture here in Aus combined with the high minimum wage makes labour costs high and replacing at the owner's expense for parts is better (for the dealer) than paying wages for lengthy repair procedures.

Being a huge VW fan I can just picture how I would remove the sump and disconnect the connecting rods to inspect the crankshaft to see if it can be mended with new bearings.

From there it might be a quite bigger job in removing the gearbox, flywheel a timing belt pully to get to the crank shaft seals before the crankshaft can be removed.
If pistons must come out manifolds will need to be removed to get the cylinderhead off.

It sure can become a lot of work quite quickly.

VDL Adelaide had a Golf mk6 R engine a little while ago for something like $6k so its just a matter of checking regularly on ebay and gumtree but still quite a job to swap the engine.
And of course then your engine number dont match the one on VW's system and your rego.

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https://rover.ebay.com/rover/0/0/0?mpre=https://www.ebay.com.au/ulk/itm/273318065458

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It can almost be guaranteed the crank, rod, and possibly head are trashed if it failed as described. A replacement engine is probably the most reasonable way forward. I don't know how warranties work in Australia but in the US it would be considered unreasonable to expect anything to be done for a 9 year old car.