2000 Saturn SL2 Knocking Noise from Engine

This is my Mothers Car
The Engine started a knocking noise on her way home on a 6 hour drive. I changed the oil 600 miles prior to her trip, no leaks.
on her way back from Erie PA to Washington DC the car started making a real loud knocking noise, she turned in off ASAP and checked the oil, it was out. A road side assistance person put 4 qts in and she drove to the next exit and pulled into a walmart, they filled it up again with oil. She got down the road another 15 miles and it started knocking again. This time she had the car towed to Saturn. They said it was out of oil and she needed a new engine. ($4500) I trailed it back to my house and started to investigate was was going on, it did not leak any oil, no spray under the car, drain plug was tight, filter was tight.

I pulled the uni-belt off, removed the spark plugs and valve cover, timing chain is tight. I turned the motor over by hand using the crank pully and for every 1/8 turn of the pully the knocking noise would click 4 times, so I assumed this was a bad Oil Pump since it is driven by the crank shaft. So I pulled off the timing chain cover and took the oil pump cover apart, the cogs look good, no broken lobes and no scaring. I turn the motor over again by hand without the cover on and I did not hear and clicking noise. I checked the oil with a magnet for metal shavings and found some small peices as well as a lot of fine metal shavings almost like dust. I noticed that the chain guide is loose but not broken.

My Question is, should I get an oil pump kit and replace the chain guides or should I not waste my time and get another engine? Because the oil went somewhere and it did not leak it so I assume it was burnt. Any Ideas

My mother is 68 and on a fixed income (SS) I have no money to put into the car as well, she still has another year of payments any ideas please.