Agreed, I think that good used with warranty or reman with warranty are the best choices.
I think that we're all saying walk away from that $18k price tag at the dealer It's not cheap, the warranty sucks, you're getting some half new/half used hybrid that likely sounds like it will not be gone through completely, etc.
Even if Toyota cover 50% I still would insist on having the good head rebuilt by a machine shop. And maybe the other head isn't junk either. It would be good to see a pic of the damage to the head. A small-medium gauge could be filled with weld and machined back to spec: I only wish I could TIG aluminum like this. And I've tried. Not saying just anyone can do this or that it is the right thing in this case, just that it can be done.