The way I understand it, to keep the car running, I have 2 basic options at my disposal:

1) Your basic overhaul- pistons, rings, valves, cams, bearings, all of these things get serviced, measured and replaced if needed. With this degree of leakage in cylinder 1, this is the least level of service recommended by any of the shops. Typically, this runs $3800- up (depending on which parts require replacement), BMW SPECIALTY SHOP B quoted $5500 for this operation at their shop.

2) A new motor from the factory will run about $1000 labor for installation- so it comes in close to $7000 total, I have had verbal quotes from all of the above listed references of anywhere from $6500-$7500 for such a job.