Wait a minute...
A misfire and a broken rod do go together (sorta) but a broken rod would almost certainly blow the engine - either out the side of the block or other noticeably nasty ways. A broken VALVE stem would create a misfire and as long as the valve stayed in the head and didn't drop in the cylinder you'd have a dead cylinder but you'd be able to drive it...
Now, if the engine is shot then it depends on how much you enjoy your KJ. 320K on the clock is a lot of miles but if the body is in decent shape and other mechanicals have been maintained then a new/reman engine is a decent investment. In my opinion, replacing the engine is a reasonable expense if you like the Jeep. Because by the time you put a down payment on a new/used vehicle, consider the increased insurance rates of a newer vehicle, monthly payments, etc, then $3000 (on the high side) for a replacement engine is a good deal.
Personally, until the body falls off my KJ I will drive it till I'm not allowed to drive anymore. I've put in a new engine and the $1500 it cost me is less than 6 months worth of payments on a cheap new car - and it wouldn't have near the fun or capability of the Jeep. I'd do it again in a heartbeat :waytogo:
Bob