2001 Ford Escape Water Damage

My wife recently made a bad choice about crossing a overflowing creek on her way home. The truck just cut off. I had to push it out. I let it sit for a day, and the truck wouldnt start.

I had it towed and the machanic had to put a new starter in, new wires, spark plugs.

He said that he finally got it cranked up and it's a very loud knocking sound. He said he's not sure but he thinks is a bent/broken valve. He said that if it was his car, he would replace the whole engine.

Is his diagnostics correct?

Should I just replace the engine?

How must will it cost to replace a whole engine?