new head or a rebuilt one, your new timing belt cover, coolant, some parts here and there, gaskets, oil change, zink brake in additive, and another oil change 1000 miles later with fitler,
first steps are to pull the head off. if you can do that, you can put it back on. you can strip the head down your self with some special tools, give the head to a local shop who can press in new guides and relive them, new oil seals, and grind the seats, dont have it resurfaced though, its not as straightforward as just decking it in a jig like most engines.
you need to pull the head first and check piston protrusion, its possible to bent the rods if it was going hard enough. its not as cut and dry as just slap a new head on it. are the wrist pins ok? are the rods ok? what is the TDC height to the deck of the block relationship measure?
i think 3 grand is a fair price for a new head if you have a shop do it or do some performance stuff while your in there. the car is hardly worth $1000 to $1200 if its in REALLY good shape with No rust and all things up to date and no issues, with new tires!
the way i see it, your spending more then the cost of running used car to fix one that already cost you a purchase price. no matter what you do unless you do all the work yourself and minimize cost, its a waste of money.
many here love their car and i get that, i loved my 1st jetta and i still have it, kinda but you have to be smart too about this. dont get under water on it.
i see budget cars as cost per mile. $3,000 for 250,000 is a good deal seeing as you can get crazy good mileage on them, they are worth keeping on the road, comparatively to the alternative cost.