Can you explain to me how an engine can have no oil and the gauge doesn't move?

Cluster is hooped?? what is that?

We think this is what we are going to do. Is it worth it though? I am not sure what kind of warranty he will give. We have a mechanic that does this and has a good reputation. We are also asking Ford for a quote as they give a 3 year warranty on a new engine.

How can you have pressure with no oil?

the oil sender will measure pressure only. if there is 1 qt in the pan you will get the guage to read, albeit in may read lower but it will still read because it is making pressure. If you have an oil light (also call an idiot light), the light will only come on when you have almost no oil pressure, like 8 lbs or less. these are not level indicators but pressure only. If there is any type of pressure at all the lamp probably will not illuminate.