Was driving great and then all at once the engine is gone at 125K miles.

I have to agree with your shop. Replace the motor, but only if the truck is in great shape. If it drives, get your CAP (Consumer Assistance Program) retirement money, either 1000.00 or 1500.00 depending on your income.

Unless you really love this truck it is time to let it go. The less expensive repair would be to find someone that will install a used eng. Salvage (recyclers) companys are a valid choice. Most give a 90 day or more warranty. The 3.0 is not that bad of a engine. Even with the purchase of a used engine it will still cost you at $1000 to $1500. Try going to Craigslist, under automotive services to find an inexpensive mechanic to do the job. Ask for references, do a little reasearch. If the truck is in good shape I would fix it.