A rebuild is the only way forwards in this situation. My N/A started doing the exact same thing a year or two ago. As stated above, it's really simple and relatively cheap to fix. It just requires the balls to do it and the time (a good 3 day weekend).
Here's a full run down:
The Problem:
Typically the N/A is regarded as the true workhorse of all Land Rover engines, even more so over newer engines. The military have certainly relied on them since production, and even chose them over the newer 200tdi engine for an extended period of time. In fact, many of them are still in use in the military right this very moment. So even if it's only covered 150,000 miles on the road for example, you can almost guarantee that it's doubled that in the amount of work hours that it's had. Lets not forget the farmers who've thrashed the nuts off them trying to pull broken down tractors out of muddy fields etc. etc.
Obviously, all this work wears down the rings, and in some cases, if the engine is neglected, it will cause further damage MOST of which you can repair along the way. Overheating will no doubt encounter cracks or splits in the piston crowns and if it hasn't seen an oil change for a couple of years the bearings might have started wearing a little quicker which leads to an unbalanced / un-true piston movement, which in turn wears your bores oval.
What to consider:
If you're enthusiastic about the engine and you don't want to splash out £400ish for a 200tdi or 300tdi engine to transplant, a rebuild is the way forward and will usually cost somewhere within the region of £250. It's a great learning curve, you'll enjoy it and best of all you know that it's going to be good for another 200,000 miles or so. If you can afford to swap the engine, most people will tell you to go for a 200 or 300 tdi. They're direct injection, turbo powered diesel engines and they're just as bomb proof as your N/A. The advantages being that it'll achieve slightly better fuel economy, it'll accelerate away much quicker and achieve a higher top speed and it has a higher torque figure, so you'll be able to pull a higher mass. The choice is yours.
How to rebuild:
Rebuilding your engine is really dead simple and it can be done left in place, attached to your vehicle. There's nothing to the N/A engines to make it too complex or too daunting a task. In theory, you can have your pistons out within 3 hours, if not less. YOU MUST make a cardboard organiser for your push rods and head bolts because they need to go back into the exact same thread / hole that they were removed from.
1) Drain Engine Oil from sump
2) Drain Coolant from engine block
3) Remove Glow Plug wires (leave glow plugs in place)
4) Remove Injector spill pipe (runs across top of injectors)
5) Remove Injectors (don't be scared to pry / tap them loose)
6) Remove Air Intake Manifold
7) Remove Exhaust Manifold (only unbolt it, then pull it away from engine)
8) Remove Rocker Cover (Held on with gasket / 3 stud nuts)
9) Remove rocker shaft (4 head Bolts, 4 securing bolts)
10) Extract all 8 push rods and store in order they came out
11) Loosen Head Bolts progressively and store in order they came out
12) Lift off head, may need some leverage VERY HEAVY!
You have now exposed your piston crowns. Inspect the surface of them very closely. White spirit on a rag will clean them up nicely so that you can see whether or not they are split or cracked. If there are any signs of damage, buy a set of new ones (about £35 each with rings fitted). You will want STD (standard) size pistons. Also briefly check the bores. If there are any vertical scores deep enough to feel with your finger nail, you'll need a rebore which is totally un-economical, so consider a 200tdi or 300tdi engine to transplant.
13) Remove all oil sump bolts
14) Prize off oil sump (it will always drip oil!)
15) Remove the big end caps from the conrods and keep in order
16) Knock the pistons up and out of the bores using a broom handle and a hammer
17) Deglaze bores with your glaze busting tool whilst simultaneously having someone spray WD40 into the bore you're working on.
Now you're ready to rebuild. It's the same, just in reverse. YOU WILL require a piston ring compressor tool to re-fit the pistons mind!
-Pos
