99 Grand Cherkoee Engine Problem

Hello everyone, I just got some bad news from the mechanic and I wanted to see if I could get some advice from someone here.

I have a 1999 Jeep Grand Cherokee with 99,000 mi. on it. About 2 weeks ago, I noticed a hollow knocking sound coming from the engine, most noticeable when the engine is idling or in a low gear. I brought it into the Chrysler/Dodge/Jeep dealer and they said that it was a lower end noice, and that the cause was Cylinder #1 Connecting Rod is damaged. Their recommendation is that the whole engine needs to be replaced, and they quoted a remanufactured engine at $4800.

What should I do?

I love the car and want to continue driving it, but I am not going to put nearly $5K into it at this point, and selling it "without an engine" wouldn't get me hardly anything. Anyone familiar with this problem?

I think you should take it somewhere else other then the STEAlership, but I dont know that sounds way steap.

Why can't the rod just be replace, why the whole engine?

Why can't the rod just be replace, why the whole engine?
You can, it's just easier and more profitable for the dealer to replace the entire motor.
Is this a 4.0 motor or a v8?
How loud is the noise? How does the motor run?
Engine noises are difficult to diagnose, and It's impossible to make a 100% positive assessment without pulling at least part of the motor down, I would doubt the dealership did. If they did, ask what exactly is wrong with the rod.

There is no reason in the world to take it to a dealership, unless it's under warranty or you don't mind paying nearly double for labor.
Find a good independent shop and get it diagnosed and if necessary repaired.