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In the US, a new engine will go $11k or so
Figure that out with your dollar/loonie and figure if you can make a profit.
This sort of deal works if you can do the labor yourself as paying dealer rates makes the deal financially a loser. Or if you plan to change the engine to a larger one.
When you go to sell it, you'll be competing with the mechanic who bought a used engine and will put the engine in in his spare time. He can make the deal work that way.
If it was a simple fix, the current owner would have done that. But the current owner got scared by the price the dealer quoted him for replacement and is trying to unload it.
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