Exactly. Cars get scrapped because the part costs $W, you can't run a compliant business for less than $X, the tech needs to be paid $Y, the service manual subscriptions cost $Z and they all add up to a number greater than what a 2002 Cavalier is worth.

An under the table side gig mechanic can perform many more jobs in an economically viable manner because the fixed costs are so much less.

This might narrowly be true if your definition of engine excludes other ICE-only components like the transmission or radiator (which is technically correct in specialist discussion but not general usage). The most common non-crash explanation I’ve heard people cite for turning cars into write-offs with is a blown head gasket, so I’m not sure about your thesis in general, and it’s certainly not something an electric car owner needs to worry about along with a slew of other cost/complexity increases specific to ICEs.

>> a blown head gasket

That's a one/two-hour job, a thousand dollars at most. I don't think they are selling the car because the engine is bad rather that the car is now worth more in parts than as a complete object. The engine isn't dead, just in need of repair. This happens to electric drivetrains too. Windings break. Bolts shear. Bearings fail. And many/most electric cars (tesla) still have transmission-type things between their motors and wheels.

1-2 hours if it doesn’t cause heat damage - maybe my relatives have been unlucky but a couple had warping from explosive failures.

(Disclaimer: I’m a software guy, might be misremembering – the key point was that basically all of the times I’ve heard someone mention involuntarily getting rid of a car it was either an accident or something which does not affect BEVs.)