Coolant leaking into engine and knocking noise

What is your question?

I don't know what to do. Bought this car "Petey" about 1.5 years ago and paid $3000. I've already had to replace 4 tires, repair the ac and heat, blew a tire and had to replace it along with a number of other problems that have cost about $3000 in repairs. Now I'm out 6 grand in 1.5 years and my engine started knocking and has gotten to the point it's starting to make Petey vibrate when in running and in park. I took it to a repair shop and started it up for the guy. He heard the sound and immediately said "that's really not good". He took a look at the cap on the oil reservoir and pointed out the milky color it had to it. Apparently my loss of coolant (constantly having to add about every 3 weeks) is a result of it leaking into the engine. The mechanic said it would be $1500 in labor alone to fix (something in the engine is broken, possibly a head gasket). What should I do? Cut my losses and try to get rid of it? Part it out? Buy a used engine? I just graduated from college and in the process of finding a job so money is super tight currently. Any and ALL help is much appreciated! PS I have read similar posts and apparently this is a pretty regular issue with this make/model. Thanks GM!!!