Is this a plausible estimate for a Vario Sensor?

[wsmcdowall]

Good morning everyone. I had a sudden loss of power and a CEL light on my 1999 Boxster 5sp Base. I nursed it home. P1531 ~ so Variocam Adjustment sensor on the intake side. I took it to my local dealer which is fortunately a couple miles away (car ran fine BTW). They confirmed my theory after a full diagnostics test.

I have an estimate for $3750 because the engine needs to come out. The part is $554...which is not bad for that particular part. Has anyone had this sensor go out? Does the engine really need dropped???

Thanks Much in Advance!