2010 Mini cooper Misfires 1k miles after full top/timing repair

I have a 2010 Mini, it did not pass DEQ due to smoke. I took it to a local
shop, they said valve seals, head work, eventually timing chain. Over 6K in
repairs. After less than 1K miles getting misfires and rough idling. They did
some testing and say it is due to leak-down issues. They took the head off
and at least one cylinder is slightly out of spec (so should not do a ring job).
The car did not misfire before , is it really likely that it is an "existing" issue
like this and not something else. They are now recommending a full engine
replacement. Looking for advice, I think they gave up on the misfire issue too
soon .. Are cylinder issues common with this engine? Hard for me to believe
slow leakage problem causes misfire ...