Well then if he knows what you need, then ask him!
Also, he may be your mate now, but if your engine goes pop and he doesn't think it's his fault, I can't see him shelling out another grand of his own money just to keep you happy. Seriously, just tell him you want a price to get your engine back to where it should be AND a price for an engine that will take 500bhp (or whatever), and then pick your option. That's the point where you can post up here and tell us what someone who has actually seen the engine says you need, and we can then either agree or disagree based on the evidence.
Bloody hell Bradders, you don't half make life difficult for people that want to help you sometimes!