Recently my car starting making this knocking sound. Brought it to the dealer and they recommended a new engine. They found some metal flakes in and around the cam lobes. Car is very sluggish when going from full stop to moving again. No CEL is being displayed

I can hear the knocking the loudest by the PCV. They didn't make any mention of a sludge issue but I know these cars are known for it.

Car has 82,000 miles, oil change done 600 miles ago using OEM filter from the dealer and Ravenol HPS Vw Oil 5W-30 oil. Plugs changed by dealer at 75K.

Any ideas before I shell out a ton of cash on a new engine?

I made a quick video