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On our old E36 we had rod knock. Shut the car down in a couple blocks after it started. I can tell you the shavings got everywhere in the engine. It ruined the crank, and one of the camshafts. The oil filter will not stop the shavings from going everywhere. I'm guessing the timing chain may have carried the metal shavings into the head but I'm not sure.
We ended up taking the car completely apart, pressure washing the bare block and spending about $2K on parts. On the N54 throw in the potential damage to the turbos and I'd just look for a used engine to drop in as others have stated.
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