Maybe not the head gaskets, but I would do the rest… Just to be safe… The cost should be very low with the motor out of the car. Thats just my .02…
I agree.Ask him to at least do the belt, waterpump, etc. f he balks, maybe offer you buy the parts if he’s willing to put them in. The parts are pretty cheap.
Breached head gaskets could also cause this particular symptom but it's hard to fathom both sides giving completely up at once.
It’s rare, but I have seen it happen. I had a v8 in a Ford Econoline blow both gaskets at once when it was 8 months old. It was so weird that Ford flew engineers in to the dealership from the factory to look at it and try to figure out what happened. The last I heard, they had no clue.
I agree with you, btw. They might be jumping the gun on replacing the whole engine.
I think OP should also call Subaru and tell them what happened. On such a low mileage engine in a car that probably just went out of warranty, they might be willing to help him out with the repair costs as a customer courtesy.