My engine went boom and then started make a loud noise which sounds like plastic popping around. The car still runs but the dealer stated the engine is blown. I heard this may not be the case as GM put more plastic parts in the version II than version I engine. Could this be the case that it is just a piece of plastic that broke? What part is this?
Without knowing year, make and model and more info, its difficult to say. Does the engine still run with the loud noise? Some small GM engines (2.5L, 151) have a composite (plastic) timing GEAR instead of a chain, which break occasionally. This is an est. $80 part. In such case the engine would crank but not start, or would make a lot of noise. Ive had a simple fly-wheel bolt come loose and that really makes a lot of noise but you can actually drive the car just fine.
If your halfway mechanical, remove your valve cover and inspect the parts. Remove your oil pan (drain oil first) and inspect in there. If both seem fine, then remove the timing gear cover (usually where all your belts are). Now the latter requires quite a bit of work removing all the pulleys, etc. to get the gear cover off, so do this if all else fails. Dont just do one thing and not do another, as there may be multiple problems in these cases.
Once you have established that it is any of (or none of) the above. Begin there and feel free to reply back here again once you have more info.