The engines actually aren't too hard to work on. The service manual is pretty good, and it is easy once you break it down into sections (take apart top end, left side, right side, center case). I can help you by posting pictures or trying to answer any questions you might have since I have basically rebuilt the engine in mine. You can look at my photo album to see the carnage caused by a broken bevel gear which is an issue these are known for.
As far as your issue, the problem to first look at is the hole in your case. A new set of crankcases from AC is a little over $1000. If you are lucky you can find a good used set like I did for a lot cheaper. Other option is finding somebody that can weld aluminum. Just hope that the hole is all you have and no cracks.
If you do go with the new engine, the $2500 isn't bad. But there is no way I would give them $700 to install it. You can save yourself the $700 and do it yourself as it is pretty dang easy. You might be out a few $$$ to rent an engine hoist (or just get a buddy and be out a few beers in payment). Although the engine hoist may save you from a back injury as it would be awkward to lift the motor up into position.
As far as the u-joint, you should be able to pop out the two c-clips and then press the u-joint out with a press tool. I got lucky and had a friend that has a ball joint press tool that I used. But you can rent them at Autozone/Oreillys and get all your money back once you return the item.
Keep us updated.
-2011 Polaris RZR-4 800 (SOLD)
-1999 Polaris Sportsman 500 ATV
-2006 AC Prowler 650XT (SOLD)-- updated bevel gears, updated oil pump driven gear, 4 wheel disc brakes, line lock E-brake, Papa Slap clutch, Xentec HID's, Dynatek CDI, Warn skid plates, Intellitronix gauges, 2010 intake/cvt duct work and dust shield, RZR seats, Bestop folding windshield, full cab kit, rear cage and rear seats (4 seater)
Last edited by out west; 10-17-2014 at 04:57 PM.