F#$%, that really sucks. A used running engine is probably your best (cheapest) bet. I would still find a local welder and see what they say. Who knows, maybe they can fix it. But, could they fix it without tearing the engine apart?
The replacement cases would be an option, but then you are looking at the cost of a complete rebuild. Your main bearings would need to be replaced as each case has different thickness bearing shells to match case and crankshaft. And, of course, all the other parts that you might as well replace as long as it is apart. I feel your pain, I was really bummed when I found the holes in my case. One more obstacle to overcome. At least if you rebuild it, you know what you have.
If you do tear it down, feel free to call anytime with questions. I'm no expert (understatement), but I have done it recently.
