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Timing chain could be big $$$ depending on if the engine is an interference design. I suspect it is. It's also possible that it's something else. In any case, if it's in good condition otherwise - it may be worth doing an engine swap, or you should be able to sell it for parts and get your $500 back. Call a few salvage yards and see what they'd pay for the truck in it's current condition (good transmission, body, seats, etc - but bad engine) - if it covers your $500 investment there's no downside to trying!
Heath
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1997 Nissan XE Truck - 133,000 Miles
1990 Infiniti Q45 - 91,000 Miles
2005 Infiniti G35 Sedan - 34,000 Miles
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