I've got the same machine as you but 285 hours on it....maybe I should check the compression?
Don't think yours is just going to let go soon, my engine still runs great. Like you though, I'm going to replace the engine maybe this winter. I'm going the SBT premium route, that $800 you figured will end up costing you $3000 in the end if you mess something up. Better off spending the 1500 on a crate motor. If you think using a grinder on an engine is a good idea, you might want to go in that direction.