First, when you initially heard the noise, you should have considered what it really was. Keeping the oil topped up, may have averted the problem. Second, the 4.3 while ok, was not really meant for heavy towing. If the trans and rear axle are ok, drop a motor into it for another 4 years of use.
First, you make a lot of assumptions in that post.
The bearing noise was first noticed as I drove into our old home in GA. I was there to load up one of our trailers with odds and ends we'd left/couldn't fit in the first moving trip we made to Cape Cod, MA. I'm 1200 miles from our new home and really had no alternative but to use the vehicle.
Second, until the rear main seal died, the bearing noise seemed to emanate from the front of the engine where the accessories (alternator, water pump, A/C compressor, serpentine belt tensioner---what I thought was the real culprit of the noise--etc.) And I could have handled any failure of any component driven by the serpentine belt during the trip up to MA....would have been darned inconvenient, but not a major problem.
Third, the oil level in that truck was
never in its entire life lower than a 1/2 qt. low. I am very attentive to fluid levels, state of condition of fluids, etc. I'm one of the probable few who actually checks air pressures more often than once a month....and have never had my tire air pressures more than 3-4psi down from what I run the tires. So, no amount of "should have kept the oil level correct" would have prevented the incident. The oil level was damned near perfect...and had just been changed less than 2500 miles before it blew the rear main seal out....and was always filled with synthetic, this time Pennzoil Ultimate. (It's not that I'm a maintenance freak or anything, but if you want something to last, esp. when really using it, then you have to do the maintenance, which I did. The rear end and trans both also have synthetics as lubes, I never skimped on quality of any parts that went into/onto the truck.)
Fourth, hundreds upon hundreds of thousands of GM truck and car owners would disagree with your assessment that the 4.3L V-6 found in GM products over the decades is lacking in towing ability. Our Blazer has a towing capacity rating of 5200#, and while we never approached that weight with a towed trailer, we did consistently tow 3000# and a little more every year, multiple times a year, for the truck's entire life and never found that engine lacking in power to pull that sort of load, including pulling through/over the Appalachian mountains for a couple of years.
I'd even put the durability of that 4.3 V-6 up there with some other notably durable engines of old, like Chrysler's 225 Slant Six or the 318 V-8 family, for instance. We never found that little 4.3 V-6 lacking in any department while we owned it and would gladly buy another vehicle with the same engine without hesitation....if GM still produced it.
Now, the question of whether to repair or replace is really more involved than just the engine. With its age and mileage, other items need looking at if not replacing, too. The steering was getting a little sloppy and before this happened, I was looking into getting all the tie rod ends replaced in a couple of months ($50/per for the parts) and probably the ball joints, also. (Was more looking into just buying complete new control arms with new ball joints and bushings already installed...$100/per arm.)
So, I'd be at $600 for front end replacement parts, without installation costs.
The driver's seat's bottom cushion was becoming worn out....not surprising given its age and mileage. Was becoming a little "flat" and unsupportive compared to newer seats and even the passenger seat in the truck. So, would need to find a way to get either a replacement seat or replace the foam cushion in the old seat. Not horrible expensive, but again not cheap.
And we'd already been talking about buying a new SUV. And since this has happened, it's kind of forced our hand. Spend thousands replacing the engine and doing the repairs I know it needs, or spend admittedly 4X as much on a new SUV with the same towing rating, something like the GMC Acadia/Chevy Traverse.
Personally, I'm leaning towards new or 1-2 year old vs. fixing the Blazer. She was stout, but honestly since we're in this position, I'll admit I'm just bored with her. After almost 10 years of driving it, something newer is more my taste today in vehicles.