Yup...full rebuild time. The metal shavings are throughout the oiling system. You also don't know if the block needs to be line honed and bored until you have it out...so....just get 'er done...done right...or you'll be doing it again soon.
A good slightly better than stock rebuilt motor with forged bottom end will run you around $6K (removed and installed by a pro). Knock a thousand or so off if you remove and install it your self. If you want a bunch of speed parts, then it gets rediculous from there. If your goals are like mine....into the high 11's...you don't need to go crazy with speed parts. Just Alky, good head gaskets and bottom end, downpipe, cold air kit, larger neck IC, cat back, and keep the boost max'd at no more than 20 for reliability.
When you put the rebuilt motor back in, if you're using the same radiator, be sure to remove the oil cooling adaptor and lines and do not use the oil cooler. The oil cooler tank in the radiator is now fouled with metal shavings and it's impossible to get it clean. You'll screw up your new motor.
Also be sure to clean out the turbo oil lines before reinstalling them....or get a new one.